SEC's Long-Running Probe into Musk's Twitter Acquisition Escalates | Image Source: E3.365dm.com
NEW YORK, December 12, 2024 – A long-standing investigation by the United States Securities and Exchange Commission (SEC) into the acquisition of Twitter by Elon Musk in 2022, now known as X, took a controversial turn. According to a letter publicly shared by Alex Spiro, Musk’s lawyer, the SEC issued an application for settlement requiring Musk to accept a monetary fine within 48 hours or multiple charges on his face. The letter accuses the SEC of conducting a political campaign against Musk and its affiliates.
The probe first focused on Musk’s compliance with the value laws when he bought high-profile Twitter, valued at $44 billion. The SEC states that Musk did not sufficiently disclose its initial purchase of 9.2% on Twitter in early 2022, a movement that has significant market implications. The Agency’s recent request would stem from directives issued by senior officials, Spiro suggesting that charges would be heavier if Musk refused to comply.
In his letter to SEC President Gary Gensler, Spiro criticized the agency’s management of the investigation, calling it “multi-year harassment campaign.” He noted that the citations were given to him personally, threats of legal action and the reopening of a separate investigation into Neuralink, Musk’s neurotechnological society. Spiro argued that these actions reveal inadequate motivations and suggested possible interference by political figures, including the White House.
Oh Gary, how could you do this to me? 🥹 pic.twitter.com/OoooQI77ZS
— Elon Musk (@elonmusk) December 12, 2024
Musk responded publicly to the SEC’s request for settlement, using its social media platform to denounce actions within a broader regulatory framework. In a recent post, Musk accused the SEC of being a “weapon of political revenge”, an echo of his lawyer’s request for clarity on who authorized the agency’s aggressive stance. Musk’s refusal to respond to the demand for settlement could pave the way for a long legal battle, for more tense relations between the businessman and the US regulatory authorities.
The SEC survey, led by President Gensler, has been criticized by some sectors for its aggressive implementation style. Gensler, appointed by President Joe Biden, has given priority to monitoring high-profile cases involving large corporations and influential individuals. However, critics argue that the agency’s approach in Musk, which has struck regulators several times, can be politically accused. These are Musk companies, including Tesla, SpaceX and Neuralink, the face examination growing on several fronts.
The stakes in this ongoing dispute are high, with implications for Musk’s businesses and the credibility of the SEC. If the case is brought before the courts, it could lead to discussions about the scope of ESA’s authority and its role in regulating business behaviour. For Musk, the battle is another chapter in his fragile relationship with regulators, which could influence investor confidence in their businesses. In the meantime, Spiro’s assertion that the SEC participates in a “guided system” reflects the growing tensions between Musk and the federal agency.
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