US Sues Elon Musk Over Early Twitter Stock Purchase Deal

Photo : X / @ElonMuskAOC

Elon Musk, the richest person in the world, has been sued by the U.S. Securities and Exchange Commission (SEC). The SEC says Musk waited too long to tell everyone that he had bought a big share of Twitter in 2022, which he later bought completely. According to the SEC, Musk did not share this information on time, which is against the law.

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Musk was supposed to tell the public within 10 days of buying 5% of Twitter’s stock, but he didn’t do so until 11 days later. The SEC says that during this time, Musk bought more Twitter shares at lower prices than he would have been able to if he had disclosed his share earlier.

The SEC says Musk spent over $500 million on Twitter shares before he revealed he owned 9.2% of the company. After Musk made the announcement, the price of Twitter shares went up by more than 27%.

Because of this, the SEC is suing Musk, asking him to pay a fine and give back the money he made unfairly.

Musk later bought all of Twitter for $44 billion in 2022 and changed its name to X. Musk’s lawyer, Alex Spiro, said that the lawsuit is just the SEC's way of attacking Musk. He also said that Musk did nothing wrong and that the mistake was just a small one. Spiro argued that if Musk is found guilty, the punishment should be small.

Musk is also being sued by former Twitter shareholders in New York. They say Musk’s late disclosure hurt them financially. Musk says he did not try to cheat anyone and that the delay was just a mistake.

Musk has had problems with the SEC before. In 2018, the SEC sued him over tweets he made about taking Tesla private. He had to pay a fine and step down as the chairman of Tesla. Musk has also had disagreements with the SEC about other cases.The SEC is still going after Musk, and the case is being heard in court.