Musk's Settlement Blasted by SEC's Jackson for Being Too Weak
(Bloomberg) -- Elon Musk got off easy in his revised settlement with the U.S. Securities and Exchange Commission, one of the regulator’s top officials said late Tuesday.
SEC Commissioner Robert Jackson, who holds a Democratic seat at the agency, said that a fresh deal struck last week with the Tesla Inc. chief executive officer failed to sufficiently punish him for not adhering to restrictions on his social media use. While the April 27 accord added specific topics that Musk can’t tweet about without advance approval, his role running Tesla wasn’t affected and he avoided additional fines.
“As a policy matter, those who settle cases with the SEC must be held to the bargain they struck," Jackson said in a statement. "Given Mr. Musk’s conduct, I cannot support a settlement in which he does not admit what is crystal clear to anyone who has followed this bizarre series of events: Mr. Musk breached the agreement he made last year with the commission.”
Jackson’s statement, issued hours after a federal judge signed-off on the SEC’s amended deal with Musk, raises fresh questions about whether the regulator has done enough to hold Musk in check. Even after the billionaire first settled with the SEC in September, he continued to criticize the regulator in tweets and in an interview on the television news show "60 Minutes."
Musk’s legal battle with the SEC began last August, when he tweeted that he had “funding secured” to take Tesla private, sending the shares surging. After an investigation the regulator sued, saying Musk had misled investors. In September, Musk and Tesla ended that dispute by each agreeing to pay $20 million. Musk also consented to have tweets that could materially impact the carmaker pre-approved by a Tesla lawyer.
But Musk came under fresh scrutiny from the SEC after a Feb. 19 tweet that the regulator said violated that settlement. Last week, lawyers for the agency and Musk agreed to settle those claims by amending the earlier agreement to clarify matters that he needs clearance to tweet on, including the company’s financial condition, potential acquisitions and new business lines.
Judy Burns, an SEC spokeswoman, didn’t immediately respond to a request for comment sent outside normal business hours.
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