SEC accuses Elon Musk of underpaying $150M in Twitter acquisition

The U.S. Securities and Exchange Commission (SEC) has sued Elon Musk, alleging regulatory violations in his 2022 Twitter share purchases. According to a Tuesday filing, Musk’s delay in revealing his ownership enabled him to underpay by at least $150 million.

“Defendant Elon Musk failed to timely file with the SEC a beneficial ownership report disclosing his acquisition of more than 5% of the outstanding shares of Twitter’s common stock in March 2022, in violation of the federal securities laws,” the agency said in a court filing.

According to the SEC, the omission enabled Musk, the world’s richest man and a close ally of President-elect Donald Trump, to continue purchasing shares at “artificially low prices, allowing him to underpay by at least $150 million for shares he purchased after his beneficial ownership report was due.”

‘Allegations on Twitter acquisition are not an actual case’

Alex Spiro, an attorney for Musk, called the filing a “sham” that culminated in a “multi-year campaign of harassment” against the billionaire. “Today’s action is an admission by the SEC that they cannot bring an actual case,” he said in an email to Agence France-Presse (AFP).

Musk’s role on the social network has been marked by numerous controversies and led to various legal actions on the part of investors, former employees and companies that had contracts with Twitter.

Shareholders, for example, have filed a lawsuit against Musk, accusing him of disclosing his five percent stake in Twitter too late, after the deadline set by the SEC.

Elon Musk’s acquisition of Twitter began on April 4, 2022, when he disclosed a 9.2% stake, becoming the largest shareholder. After declining a board seat, he offered to buy the company for $44 billion. After a long period of disputes, the deal was finalized on Oct. 28, 2022, and the platform was rebranded as X in 2023, with Musk implementing significant changes, including layoffs and leadership restructuring.