The Securities and Exchange Commission filed a lawsuit against Elon Musk on Tuesday, alleging the Ax owner misled shareholders about his Twitter stock purchase in 2022.
The lawsuit alleges that Musk violated federal securities laws by helping him buy shares of Twitter at artificially low prices ahead of his $44 billion acquisition of the social media site. Musk has SEC was called “Just another armed organization doing political dirty work.”
Musk began buying shares of Twitter, which he later renamed X, in early 2022. By mid-March, he owned more than 5% of the company's outstanding stock, according to SEC filings. He was required to file a report with the SEC disclosing his purchases, but the lawsuit alleges that he failed to do so in a “timely” manner, causing him to pay other taxes for the shares he purchased during that period. Investors were allowed to make a down payment of at least $150 million.
The commission says Musk waited until April 4, 2022, 11 days after the report came out, to publicly disclose his beneficial ownership in the SEC report.
“Investors who sold Twitter common stock during this period did so at artificially low prices and thereby suffered substantial economic losses,” the SEC alleged in its lawsuit.
The SEC says it wants the court to order Musk to pay “damages to the unjust enrichment resulting from his violations.” The SEC is also seeking civil penalties.
musk reacted to the news of the lawsuit on Tuesday night on X, calling the SEC a “completely broken organization.”
“This is how they spend their time when so many real crimes are being committed and they go unpunished,” Musk wrote.
In July 2022, Musk tried to take out deal to buy twitter, but Sue the company to hold him to his agreement, and they completed the acquisition In October of the same year.
Musk has had run-ins with the SEC before. The SEC filed a complaint in 2018 alleging that Musk misled Tesla investors. In 2023, the SEC said it was Demand for court order To force Musk to testify as part of the investigation into the purchase of X. that later testified For investigation.
The SEC lawsuit comes shortly before Chairman Gary Gensler's planned resignation from the commission. It is unclear whether the new administration will continue the lawsuit. President-elect Donald Trump has selected Paul Atkins as the new SEC chief.
musk is one Prominent Trump supporters And republican donorand has been selected by Trump to lead the Department of Government Efficiency, or Doge,