On the 14th (local time), the SEC filed a lawsuit against Musk for timely disclosure of the fact that he will own more than 5% of Twitter shares in early 2022.
In a complaint filed in federal court in Washington, DC on the same day, the SEC alleged that Musk had failed to timely disclose his shares in Twitter, allowing the company to sell the shares at a low price.
"The delay in the public announcement allowed Musk to continue buying shares at unfairly low prices, and after the public announcement was delayed, he received at least
Musk claimed that he had saved the company $150 million by acquiring 5% or more of Twitter's stock, and was required to submit a related report within 10 days of acquiring the stock.
It first submitted its report on April 4, 2022, 11 days after the deadline, and revealed that on the same day, Twitter's stock price soared by more than 27% from the previous day's closing price.
The lawsuit comes as the SEC prepares for a leadership transition. On the 20th of this month, Donald Trump took office as president and the SEC
The head of the agency, Gary Gensler, is set to step down, and Musk will reportedly be taking on the role of advising on government efficiency in the next administration.
The SEC said Musk "began purchasing Twitter shares in early 2022 and owned more than 5% of Twitter's outstanding common stock as of March 14."
"Musk used more than $500 million to purchase Twitter common stock between March 24 and April 4, 2022, and caused losses to Twitter investors of more than $150 million during that period.
"Musk's failure to timely disclose his shareholding allowed the public to sell shares at low prices without knowing about important information that was not yet publicly available," the suit said.
In response, Musk wrote on Twitter that the SEC is a "totally corrupt organization" and that "they should not waste their time on such a trivial matter."
But it doesn't punish actual crimes."
2025/01/15 12:40 KST
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