Mark Cuban reportedly urged Tesla's Musk to settle SEC fraud charges

07 October, 2018, 08:43 | Author: Salvatore Jensen
  • Wil James Murdoch be the new Chairman of Tesla?

Tesla Inc's Elon Musk on Thursday mocked the US Securities and Exchange Commission, just hours after a federal judge ordered him and the regulator to justify their securities fraud settlement, which let Musk remain chief executive. "And the name change is so on point".

The SEC declined to comment to CNBC news on Musk's tweet.

The SEC's complaint said that Musk "falsely indicated" that he could "take Tesla private at a purchase price that reflected a substantial premium over Tesla stock's then-current share price, that funding for this multi-billion dollar transaction had been secured, and that the only contingency was a shareholder vote". Musk's Tweets caused his company's stock price to jump more than 6 percent, leading to market disruption, the SEC said.

The tweet on Thursday was "plainly a statement that the SEC's case against Musk lacked merit", Crimmins said.

Amid controversies over his appearance on "Saturday Night Live" and comments about slavery, musician Kanye West visited Detroit, where he commented about Elon Musk.

The post risks putting back in play stiffer forms of punishment that the SEC sought last week, including a prohibition on Musk serving as officer of a public company.

"The SEC stayed away [from] the broader corporate governance and management issues", Turner said.




Some judges have complained about being viewed as rubber stamps for SEC settlements. The company's board reportedly hasn't had any serious discussions on who will replace Musk, but some board members have thrown their support behind James Murdoch who is the son of Rupert Murdoch and the CEO of 21st Century Fox. The settlement was announced on September 29, two days after Musk was charged.

The judge gave Tesla and the SEC one week to submit a joint letter explaining the settlement in further detail.

But, after seeing the consequences of it, I think he must be careful about his tweets.

While Musk settled the charges by agreeing to pay a fine of $20 million and step down as Tesla's chairman, he doesn't seem to have gotten over the incident just yet.

Musk is a long time critic of what he believes is a bias towards Short Sellers (ask an accountant).

Updated at 5:25 p.m. PT with Musk's tweet about short sellers.

Even though Musk's Twitter post appears to violate the spirit of the recent settlement, the SEC is largely powerless to stop Musk's tirades until the settlement is approved by Federal Judge Alison Nathan of the Southern District of NY, which could take several weeks.

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