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Elon Musk, Tesla attack SEC for 'unrelenting' harassment

17 February 2022 19:20 (UTC +04:00)

Tesla Inc (TSLA.O) and its Chief Executive Elon Musk on Thursday accused the U.S. Securities and Exchange Commission (SEC) of harassing them with an "endless" and "unrelenting" investigation to punish Musk for being an outspoken critic of the government, APA reports citing Reuters.

The accusation came in a letter to U.S. District Judge Alison Nathan in Manhattan, who presided over a 2018 SEC settlement stemming from Musk's tweet about a potential buyout of Tesla.

The SEC sued Musk in August 2018 after he tweeted he had "funding secured" to potentially take his electric car company private at $420 per share. In reality, a buyout was not close.

Tesla and Musk settled by agreeing to each pay $20 million in civil fines, and to let Tesla lawyers vet some of Musk's communications in advance, including tweets that could affect Tesla's stock price. Musk also gave up Tesla's chairmanship.

The latest subpoena was issued on Nov. 16, ten days after Musk polled his Twitter followers on whether he should sell 10% of his Tesla stake, triggering a sell-off.

In Thursday's letter, Spiro accused the SEC of ignoring its commitment to distribute to shareholders the $40 million in fines, while instead "devoting its formidable resources to endless, unfounded investigations" into Musk and Tesla.

"Worst of all, the SEC seems to be targeting Mr. Musk and Tesla for unrelenting investigation largely because Mr. Musk remains an outspoken critic of the government; the SEC's outsized efforts seem calculated to chill his exercise of First Amendment rights," Spiro wrote.