Musk lashes out against SEC, says its oversight is broken

Tesla CEO lashes out against SEC, says its oversight is broken

Tesla CEO, Elon Musk, took a dig at the U.S. SEC [Securities and Exchange Commission] again after the commission accused the Silicon Valley billionaire of breaching the terms of a settlement made last year.

Musk entered into a settlement with the SEC last year pledging that he wouldn’t divulge any material information relating to Tesla, the electric car maker without prior approval from the Tesla board. He had tweeted: “considering taking Tesla private at $420. Funding secured.” Musk agreed to pay $20 million and to step down as the Chairman of Tesla to settle the charges.

However, Musk took to Twitter last week to say that “Tesla made 0 cars in 2011, but will make around 500k in 2019.” The SEC said that this violated the agreement and he should be held in contempt for the Twitter post

Following the SEC’s decision, Musk tweeted on Tuesday, “Something is broken with the SEC oversight.” Musk clearly holds a grudge against the SEC. In an interview, last year Musk said: “I want to be clear. I do not respect the SEC.”

Tesla’s shares dropped by 0.3% after Musk took a dig at the SEC. Musk getting into deeper troubles with the SEC is not deemed good for the company. Many opine that the company might be in for losses if Musk continues his drama with the SEC.

J.P Morgan Securities analyst Ryan Brinkman said that SEC could again ask Musk to step down from his CEO role at the company for violating the agreement.

“It is difficult to judge the likelihood of the reappearance of this worst case scenario … but on the other hand the current allegations seem much less serious (than last year’s),” said Brinkman in a note to clients. “If the SEC were to seek Mr. Musk’s removal (perhaps subject to yet another settlement), we believe the shares may approach the mid-$200 levels,” he added.

Image via Shutterstock

Tesla CEO lashes out against SEC, says its oversight is broken
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