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The US Securities and Exchange Commission (SEC) has filed a lawsuit against Elon Musk, accusing the world’s richest person of violating securities law in relation to his USD 44 billion acquisition of Twitter (now X). The SEC's complaint alleges that Musk "failed to timely file with the SEC a beneficial ownership report" revealing his purchase of Twitter shares prior to announcing his ownership.
Musk began acquiring Twitter shares in early 2022 and had acquired over five per cent of the company by March that year, according to the Associated Press. The SEC claims Musk was legally obligated to disclose his ownership, but did not do so until April 4, 11 days after the report was due. The lawsuit argues that this delay allowed Musk to continue purchasing shares at "artificially low prices," potentially saving him at least USD 150 million on shares bought after the deadline for the ownership report.
Musk's attorney, Alex Spiro, dismissed the SEC's action, calling it "an admission by the SEC that they cannot bring an actual case — because Mr Musk has done nothing wrong and everyone sees this sham for what it is." Spiro further criticized the SEC, saying it "culminated in the filing of a single-count ticky tak complaint" related to a minor administrative failure, which, even if proven, would result in only a nominal penalty.
This is not the first time Musk has faced legal challenges from the SEC. In 2018, the commission sued Musk for his tweet claiming he had secured funding to take Tesla private. Both Musk and Tesla were fined USD 20 million as a result of that case.
Also Read: Elon Musk Announces Relocation Of SpaceX And X Headquarters To Texas