Elon Musk Sued by SEC Over Delayed Disclosure of Twitter Stock Purchase

By Evans Momodu
1 minute read

Elon Musk is facing a lawsuit from the US Securities and Exchange Commission (SEC) for allegedly failing to disclose his acquisition of more than 5% of Twitter stock within the required timeframe.

The SEC claims that Musk began buying Twitter stock in March 2022 but did not disclose his holdings until April 4, 2022, 11 days after the regulatory deadline. By that point, he owned over 9% of Twitter shares.

The delay, according to the SEC, allowed Musk to continue purchasing stock at artificially low prices, enabling him to underpay by at least $150 million (£123 million).

In court filings in Washington, DC, the SEC is seeking a civil fine and the forfeiture of profits Musk allegedly gained improperly.

A lawyer representing Musk dismissed the lawsuit, stating:

"Mr Musk has done nothing wrong, and everyone sees this sham for what it is."

Under SEC rules, investors must disclose their ownership when it surpasses the 5% threshold within 10 calendar days. The SEC alleges Musk's delayed disclosure violated this rule, giving him an unfair financial advantage.

This lawsuit adds to Musk’s ongoing legal and regulatory challenges, particularly related to his high-profile business dealings and public comments.
Source: Sky news