SEC Says Musk Violated Tweet Settlement: Report

Securities agency told Tesla that Musk tweets in 2019 and 2020 hadn’t gone through approval process agreed on by company.
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SEC regulators claim Elon Musk violated a settlement that required his tweets about Tesla  (TSLA) - Get Report be preapproved by company lawyers according to a published report Tuesday.

Correspondence to Tesla in 2019 and 2020 from the SEC said Musk’s tweets about solar roof production and stock price hadn’t been reviewed by company lawyers as had been agreed in a $40 million settlement between the company and agency in 2018, The Wall Street Journal reported. Under that court-approved settlement, Musk and Tesla each paid $20 million to resolve regulatory charges arising from an earlier Musk tweet that the company was on the verge of being taken private.

Tesla “has abdicated the duties required of it by the court’s order,” a senior SEC official in the agency’s San Francisco office wrote to the company in May of 2020, according to the report. The company had failed to enforce the agreed upon procedures “despite repeated violations by Mr. Musk,” the letter added.

Musk has displayed open contempt for the SEC even in the aftermath of the 2018 settlement, including an off-color tweet posted in July of 2020, after the latest letters to the company.

Shares of Tesla fell $1.42, or 0.23%, to $622.48 in after-hours trading, Tuesday. The stock edged lower in the regular session. For the year, Tesla stock is off about 14%.

In addition to Tesla, Musk has drawn attention in recent months for his tweets about cryptocurrencies, especially Bitcoin and Dogecoin.

Musk also recently appeared as the guest host on Saturday Night Live.