Musk Trolls US Securities Watchdog, Shares Of Tesla Drop


Last Thursday night, Elon Musk, the Tesla billionaire, seemed to have mocked the Securities and Exchange Commission (SEC) of the United States of America on Twitter. His tweet came less than four hours after a federal judge asked for an explanation of the settlement deal that was reached between the two sides.

In a tweet that was posted on Twitter, Musk stated: “Just want to [sic] that the Shortseller Enrichment Commission is doing incredible work. And the name change is so on point!”

He has repeatedly slammed investors who bet against the rising of the share price of the company.

The shares in Tesla dropped by more than five percent during the first hours of trading last Friday afternoon, having already closed by 4.4 percent down on Thursday evening.

Last week, Musk was able to secure a settlement with the SEC after the regulator pressed charges against him because of securities fraud. It alleged that he had misled the investors by announcing that he had secured funding for a buyout of the public carmaker.

The infamous tweet that was posted by Musk on the 7th of August detailed the plans to take Tesla private at $420 per share. The value was a number which Musk settled on after rounding up the current share price from a 20 percent premium because of its significance in marijuana culture.

The deal with the SEC asked that Musk must step down as the chairman of Tesla, even though he could continue to serve as its chief executive. It also demands that Musk pay a fine amounting to $20m (£15.3m). A $20m fine was also imposed on Tesla, despite not accepting the charges.

Additionally, the board of Tesla should implement some procedures for monitoring the communications of Musk with investors, including his activities and statements on Twitter.

Earlier last Friday, Alison Nathan, a district judge in the United States, had asked Musk and the SEC to send an explanation regarding the deal in a joint letter by the 11th of October. She said that the explanation should justify why the said deal was fair and in the public interest.

Some experts who have spoken to by Reuters suggested that there was no “serious chance” for the settlement of Musk to be rejected by Nathan. One even stated: “This is just a hoop to be jumped through.”