SEC Sues Elon Musk Over Delayed Twitter Stake Disclosure

Elon Musk is facing legal action from the Securities and Exchange Commission (SEC), which accuses him of delaying the disclosure of his stake in Twitter to secure shares at lower prices.

The lawsuit, filed in the U.S. District Court for the District of Columbia, alleges that Musk’s actions violated federal securities laws requiring timely disclosure of significant stock purchases.

The SEC claims that in early 2022, Musk quietly acquired more than 5% of Twitter’s shares without notifying regulators within the required 10-day period. By the time he disclosed his holdings in March, his stake had grown to over 9%. The announcement caused Twitter’s stock price to surge 27% the following day, which the SEC argues allowed Musk to save at least $150 million during his purchases.

Musk’s attorney, Alex Spiro, has criticized the lawsuit, describing it as a baseless and exaggerated move by the SEC. He argued that the case hinges on a procedural matter involving a single late filing and dismissed it as an attempt to target Musk unjustly. Spiro added that the penalty for such a filing issue would likely be minimal.

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The SEC investigation, which began in 2022, focuses on whether Musk’s delay in reporting his stock purchases gave him an unfair financial advantage. The agency is seeking civil penalties and the return of profits it alleges were unjustly obtained.

Beyond the SEC’s claims, Musk is also facing lawsuits from investors who accuse him of concealing his Twitter share purchases. Meanwhile, Musk has taken on a more prominent political role, emerging as a key advisor to President-elect Donald Trump. He has been involved in discussions on government cost-cutting measures and foreign policy, positioning himself as a central figure in the new administration.

Kosta Gushterov

Kosta has been working in the crypto industry for over 4 years. He strives to present different perspectives on a given topic and enjoys the sector for its transparency and dynamism. In his work, he focuses on balanced coverage of events and developments in the crypto space, providing information to his readers from a neutral perspective.