The SEC has filed a lawsuit against Elon Musk for failing to promptly disclose his purchases of Twitter shares. In 2022, Musk began acquiring Twitter stocks and should have informed the Securities and Exchange Commission once his holdings reached five percent. However, he reported his stake 11 days late, when it exceeded nine percent.
On January 14, 2025, APNews announced that the Securities and Exchange Commission filed a lawsuit against Elon Musk for not revealing his ownership of Twitter (TWTR) stocks before buying the social media platform. The SEC argues that by not disclosing his stake in more than 5% of the company’s shares, Musk underpaid at least $150 million.
According to reports, Elon Musk was compelled to reveal his ownership of shares once they exceeded the five percent threshold. However, it was mentioned that he notified the SEC about this 11 days later on April 4. Reuters further disclosed that Musk announced his stake in Twitter when it had grown to a significant 9.2 percent.
In Tom Krisher’s article, it’s mentioned that Elon Musk’s reveal of his ownership in Twitter caused a surge in the stock price by 27%. The lawsuit claims that this delayed disclosure significantly influenced investors who had already sold their shares prior to Musk’s announcement. As a result, these investors missed out on the substantial increase in value (approximately $50 per share at the end of trading on April 4).
Elon Musk remains a frequent topic in news headlines, both positively and negatively. He’s recently declared his intention to establish an AI-focused video game studio, sparking controversy over a potential $1 million donation that might breach federal regulations, and labor unions have filed lawsuits against him under employment laws. However, amidst these issues, Tesla (TSL) shares soared above $420 per share in December 2024.
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2025-01-15 04:57