US SEC Targets Musk Again? ... Subpoena Issued Following Stock Sale Survey in November Last Year

Elon Musk, CEO of Tesla
[Photo by Reuters]

[Asia Economy Reporter Jeong Hyunjin] The U.S. Securities and Exchange Commission (SEC) has once again summoned Elon Musk, CEO of Tesla. CNBC and other media reported on the 7th (local time) that this appears to be an investigation related to Musk's 'unexpected tweet' last November asking whether he would sell 10% of his shares.

According to reports, Tesla announced in a regulatory disclosure on the same day that it received a subpoena from the SEC on the 16th of last year to verify compliance with the settlement agreement reached between the two parties in 2019 regarding Musk's tweet activities. The SEC stated in the subpoena that it is seeking information related to Tesla's governance processes concerning compliance with the agreement with the SEC.

CNBC reported that the timing of the SEC's subpoena appears to be linked to Musk's November 6 tweet last year, in which he posted a poll asking whether to sell 10% of his Tesla shares, and about ten days later, the SEC issued a subpoena for investigation. At that time, the majority of followers answered 'Yes,' and the stock price subsequently declined. In fact, about a month later, in December last year, Musk sold 15.6 million Tesla shares to pay taxes from exercising stock options, securing $16.4 billion (approximately 19.7 trillion KRW) in cash.

The Wall Street Journal (WSJ) assessed that the SEC has resumed a detailed investigation into Musk's social network service (SNS) activities.

The history between Musk and the SEC began in 2018. At that time, Musk tweeted that he was considering taking Tesla private, which caused significant market turmoil, and the SEC filed a lawsuit accusing him of securities fraud. Subsequently, Musk paid a total fine of $40 million and agreed with the SEC that Tesla's in-house lawyers would pre-approve some of his tweets.

However, disputes between the two parties continued. In 2019, Musk disclosed production figures for the Model 3 on Twitter, and the SEC pointed out that this violated the agreement as the tweets were not pre-approved by lawyers. Eventually, the court required Musk to specify in advance the content that must be reviewed by lawyers before tweeting. In 2020, Musk also drew the SEC's ire by tweeting that "Tesla's stock price is too high."

Following these reports, Tesla's stock closed at 907.34 on the U.S. Nasdaq, down 1.73% from the previous day.

This content was produced with the assistance of AI translation services.