American watchdog suing Elon Musk for tweet

American watchdog suing Elon Musk for tweet

Elon Musk is being sued by the American stock exchange watchdog. The Securities and Exchange Commission (SEC) has reached this decision in response to messages from Musk on Twitter. There he said he wanted to take Tesla off the scholarship. This had an impact on the share price and it is possible that Musk made a profit from this.

That’s what press agency Bloomberg reports today. The SEC has filed a lawsuit in New York claiming that Musk has misled investors by claiming that he was ready to take the company off the stock market. The SEC not only wants Musk to pay a hefty fine, it also believes that a judge prohibits Musk from being active as the director of a public company.

False and misleading

Musk’s statements were false and misleading, according to co-director Stephanie Avakian of the SEC. Almost immediately after the announcement of the lawsuit, investors began to dump shares in Tesla. Currently, the share price has fallen by thirteen percent to less than $270.

According to the SEC, the problem is that Musk has become careless and capricious lately. On Twitter he put forward to consider Tesla for $420 per share to retrieve from the stock market. That’s a price far above the share price at the time, and a number Musk came to because it’s a code name for marijuana. In a reaction Musk let us know that the trial is unjust and that it is very sad and disappointing.

Transparency and truth

According to Musk himself, he always attaches great importance to truth, transparency and investors. Integrity is the most important value in my life and the facts will show that I have never put it at risk. The board of Tesla also says that they fully support Musk.

The controversy began in August, when Musk suggested on Twitter to consider taking Tesla off the stock market. He’d have the funds ready for that by now. But according to the SEC there were no agreements at all, so Musk couldn’t make that statement at all. At the same time, there was already an investigation into Tesla, which according to the SEC mentions far too high production figures. The car manufacturer is struggling with the production lines of his cars, which still have a lot of errors and therefore do not roll off the conveyor belt as quickly as hoped for.

This news article was automatically translated from Dutch to give a head start. All news articles after September 1, 2019 are written in native English and NOT translated. All our background stories are written in native English as well. For more information read our launch article.