The Securities and Exchange Commission (SEC) is attempting to compel the billionaire to testify as part of a probe into his Twitter acquisition.
The long-running feud between Musk and the SEC has escalated, as the Tesla owner now faces a lawsuit over the company’s purchase of social media platform Twitter, now rebranded as X.
The SEC is investigating whether Musk broke federal law in 2022 when he bought stock in the platform and the paperwork that he filed in relation to the transaction.
Before the billionaire obtained full control over Twitter, Musk bought a 9.2 per cent stake in the company, becoming its majority shareholder. The purchase was not disclosed in an SEC filing until the following month and led the company’s other shareholders to sue Musk, with no success.
Musk’s purchase of Twitter stocks merely months before his acquisition of the platform could see him facing charges of insider trading, market manipulation or even violation for fair market disclosure.
As part of the investigation, the SEC subpoenaed Musk. However, days before the scheduled date for the testimony, on September 15, he raised “several spurious objections”, such as disagreeing with San Francisco as a location and refusing to attend.
Musk also refused SEC proposals to conduct the deposition in Texas, in October and November, the SEC said.
“Musk’s ongoing refusal to comply with the SEC’s administrative subpoena is hindering and delaying the SEC staff’s investigation to determine whether violations of the federal securities laws have occurred,” the attorneys wrote. “Accordingly, the SEC now asks the Court to compel Musk to appear for investigative testimony.”
The Tesla and SpaceX owner argued that the SEC was trying to “harass” him and his counsel needed time to review potentially relevant material contained in a biography of Musk written by Walter Isaacson and published last month, the SEC said.
“The SEC has already taken Mr. Musk’s testimony multiple times in this misguided investigation – enough is enough,” said a statement from Alex Spiro, an attorney for Musk.
The Twitter rebranding is only one of the many controversial changes Elon Musk has made since his $44bn (£38bn) takeover of the company in October 2022. These include dissolving the company’s board of directors, making significant changes to the platform’s content moderation policies, and firing more than half of the company’s workers, along with a number of additional contractors.
The SEC is also investigating Musk and Tesla over their claims regarding Tesla vehicles’ ‘full self-driving’ capabilities, as well as Tesla’s use of company funds to build Musk a secret ‘glass house’.
