The U.S. Securities and Exchange Commission to Request Elon Musk’s Testimony on Twitter Stock Purchases
The U.S. Securities and Exchange Commission (SEC) will try to force Elon Musk to testify over his Twitter stock purchases.
SEC Investigates Alleged Violation of Securities Laws
The federal agency charged with regulating securities markets is currently investigating Musk for allegedly violating securities laws when he bought Twitter shares before buying the social media platform, which he has since renamed X.
Purchasing Twitter stock before acquiring the company could mean Musk was guilty of insider trading, market manipulation, or even violation of fair market disclosure.
Musk Fails to Appear for Testimony
The SEC said on Thursday that Musk failed to appear to testify last month as requested. According to a filing by the agency in federal court in San Francisco, first spotted by Bloomberg, the agency is auditing Musk’s statements and disclosures about the stock transactions.
Since the SEC began its probe in April 2022, Musk has sent hundreds of documents and testified twice in July 2022, according to the filing. The investigation is ongoing and nonpublic.
Dispute Over Interview Location
The agency said Musk agreed to an interview with the SEC last month in San Francisco, but two days before the scheduled September 15 meeting, the billionaire raised objections, saying San Francisco wasn’t a good location for it. He has claimed that San Francisco jurors dislike him after a questionnaire sent out to 200 prospective jurors came back with majority negative opinions of Musk.
The SEC suggested moving the interview to Fort Worth, Texas, where Musk resides, but the agency says he refused to meet at all.
Past Issues with the SEC
This isn’t Musk’s first tussle with the SEC. Famously, the Tesla CEO has been ordered to have a lawyer review his Tesla-related tweets after Musk tweeted in 2018 that he had “funding secured” to take Tesla private for $420 per share and that investor support for the deal was confirmed. Tesla’s share price fluctuated in the weeks that followed, which prompted an SEC investigation into whether Musk had committed securities fraud.
The SEC is also investigating Musk and Tesla over their claims regarding Tesla vehicles’ “full self-driving” capabilities, as well as Tesla’s use of company funds to build Musk a “glass house.”