Tesla’s Elon Musk Hits Out At US SEC

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Telsa boss has “no respect” for the US Securities and Exchanges Commission after stepping down as chairman

Elon Musk, the chief executive of electric car maker Tesla has lashed out again at the US Securities and Exchange Commission (SEC).

Musk in an interview with news channel CBS, admitted that he had “no respect” for the SEC, in his second attack on the US financial regulator after it forced him to step down as chairman of Tesla and pay $20m in penalties.

Musk has come under fire for his outbursts on Twitter in 2018, and he admitted to CBS that Twitter was a “warzone” and if “you are in the area, lets go.”

Tesla - Shutterstock - © Hattanas Kumchai

SEC settlement

Musk made controversial comments on Twitter about one of the rescuers of the Thai boy football team that were trapped in a cave earlier this year.

But Musk really got into trouble in August, when out of the blue, he tweeted that was considering taking Tesla private and that he had secured funding to do so.

Musk was almost immediately with two lawsuits which alleged that Musk’s Tweets were fraudulent effort to attack short sellers.

These tweets brought Musk to the attention of the SEC and it sued Tesla and sought to ban Musk from acting as an officer or director of a publicly traded company.

The SEC accused Musk of securities fraud, and alleged he made a series of “false and misleading” tweets about potentially taking Tesla private.

Musk, 47, is the public face of Tesla and the move by the SEC to bar Musk as an officer of any public company was a rare move against the CEO of such a well-known firm.

But Musk, Tesla, and the SEC soon reached a settlement, which saw Musk and Tesla pay $20m (£15.3m) each.

Musk paid to settle the SEC fraud charges, and Tesla paid $20m to settle claims it failed to adequately police Musk’s tweet.

As part of the settlement deal, Tesla also hired two independent directors to strengthen its corporate governance; Musk was forced to step down as board chairman.

No respect

Musk reportedly accepted the deal with the SEC “without admitting or denying the allegations of the complaint,” according to a court document.

But within days of the settlement, Musk took to Twitter to mock the regulator, describing it as the “Shortseller Enrichment Commission” and praising its “incredible work”.

And now in the interview with CBS, Musk said that his tweets are still unsupervised, and that only if a tweet had a probability of causing a movement in the stock would it be “reviewed.”

“I want to be clear, I do not respect the SEC, I do not respect them,” he told CBS. But when he was questioned why he abiding by the settlement, Musk responded because he respected as the justice system.

When he was questioned if he will seek re-election as chairman (he cannot for three years as part of the SEC settlement), Musk said no, and that he prefers no titles at all.

It should be noted that the SEC settlement does not mean that a separate Department of Justice probe over Musk’s tweets (which can file criminal charges) has ended.

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Author: Tom Jowitt
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