Elon Musk accused by SEC of twisting Twitter deal investigation

Tensions are escalating between Elon Musk and the Securities and Exchange Commission (SEC) concerning the ongoing inquiry into Musk's acquisition of Twitter
An undated image of Elon Musk. — Reuters
An undated image of Elon Musk. — Reuters

In a recent development, tensions are escalating between Elon Musk and the Securities and Exchange Commission (SEC) concerning the ongoing inquiry into Musk's acquisition of Twitter.

The SEC's frustration appears to be intensifying due to what they perceive as evasive legal strategies employed by Musk. The core of the dispute revolves around Musk's reluctance to participate in the investigation.

A fresh legal document from the SEC alleges that Musk is attempting to manipulate the narrative of the probe. The SEC contends, "Musk persistently skews the actual nature of this investigation — his sole strategy in proving that the SEC's pursuit of relevant evidence is unwarranted," indicating a clear accusation against Musk's approach to the investigation.

This probe into Musk's activities started in 2022, focusing on the tardiness of his disclosure regarding his Twitter shareholdings, back when Twitter was still on the stock market. In a bid to compel his testimony, the SEC initiated legal action against him last year.

At that time, the SEC was exploring potential breaches of multiple federal securities law sections in relation to Musk's acquisition of Twitter shares and related SEC filings. Following a federal court ruling, Musk was directed to adhere to the subpoena and arrange an interview, which was set last month.

However, Musk's testimony is yet to occur, with the SEC accusing him of deliberately delaying the investigation through various tactics. The SEC has rebutted Musk's legal team's claims that the investigation is an overly broad probe into a supposedly slightly delayed SEC filing, asserting that they have consistently informed Musk that this claim is inaccurate.

Furthermore, the SEC reveals that Musk is under scrutiny for possible securities fraud, related to his public declarations about acquiring Twitter. This aspect of the investigation is specifically examining violations under Section 10(b) of the Securities Exchange Act.

In a related twist, the SEC's filing also mentions the recent biography of Musk authored by Walter Isaacson, suggesting it contains new evidence pertinent to the investigation. Released just three days before Musk's scheduled but unattended testimony, the SEC emphasizes the book's significance in their probe.

Isaacson's account of Musk's Twitter takeover has previously caused legal complications for Musk. A lawsuit by a group of former executives, who are suing Musk over unsettled severance, also cites Isaacson's book.