Elon Musk Faces Regulatory Scrutiny for Skipping Testimony in Twitter Takeover Investigation
Elon Musk, the CEO of X and various other companies with the letter “X” in their names, is currently under the radar of regulators after failing to appear for testimony in an investigation related to his takeover of Twitter. The U.S. Securities and Exchange Commission (SEC) has stated its intention to seek sanctions against Musk for his absence in court on September 10.
The SEC filing revealed that Musk only notified the SEC three hours before his scheduled testimony, citing his involvement in overseeing the launch of Polaris Dawn, a spacecraft by SpaceX, as the reason for his absence. Despite efforts to reschedule the hearing for the next day, Musk’s attorney declined and only agreed to court dates in October.
The SEC is now seeking “meaningful conditional relief” if Musk fails to appear in court in October. The agency also plans to file a sanctions motion to cover travel costs for the canceled testimony and other relief, as it had incurred “thousands of dollars” to fly three attorneys to Los Angeles for the hearing.
The investigation revolves around whether Musk complied with the law in disclosing his purchases of Twitter stock before acquiring the company for $44 billion in 2022. The SEC is also looking into the timing of Musk’s statements regarding the deal, alleging that he delayed disclosing his Twitter share purchases by at least 10 days.
This is not the first time Musk has faced scrutiny from the SEC. In 2018, he was ordered to step down as Tesla’s chairman and pay $40 million in penalties over tweets that were deemed market-manipulating. Musk has previously dismissed these charges as unjustified.
Additionally, the SEC has previously investigated Musk and Tesla for claims related to Tesla vehicles’ “full self-driving” capabilities and the use of company funds to build Musk a “glass house.”
For further details, you can access the full filing here.
Updated 9/20 at 5:48 p.m. Pacific: Correction – Musk failed to appear in a Los Angeles courtroom, not San Francisco as previously stated. We regret the error.
