Musk gets slap on the wrist from SEC over Twitter stock disclosures
Elon Musk has reached an SEC settlement over allegations that he violated federal securities rules in connection with his 2022 purchase of a more than 5% stake in Twitter (now X). The SEC claimed Musk filed a required beneficial ownership report 11 days after the 10-day deadline, and that this delay allowed him to keep buying shares at lower prices.
The settlement required Musk’s revocable trust to pay $1.5 million in civil penalties, pending court approval, with both Musk and the SEC agreeing to the deal. Musk’s lawyer said Musk is effectively cleared for the late-filing issue, characterizing the outcome as a small fine without an admission of wrongdoing.
The article also notes the case followed the SEC’s complaint filed more than a year ago as part of the Biden administration’s regulatory approach, and mentions Musk’s othre recent legal matters, including a SpaceX-related settlement and an ongoing dispute involving OpenAI CEO Sam Altman.
Elon Musk reached a settlement with the Securities and Exchange Commission on Monday over a lawsuit alleging he violated securities law with his 2022 investments in Twitter.
The settlement charges Musk’s revocable trust with a $1.5 million payment in civil penalties to settle the lawsuit, according to documents, pending the court’s approval. Musk and the SEC have each agreed to the deal.
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The lawsuit hinged on the SEC’s allegation that Musk was late on filing a beneficial ownership report with the commission in March 2022 after he acquired more than a 5% stake in Twitter, now X. This was before Musk began the process of purchasing the social media giant in April 2022.
The SEC alleged in its initial complaint that Musk’s failure to disclose within 10 days of reaching the 5% threshold violated federal securities laws. The SEC said he filed 11 days after the report was due.
“As a result, Musk was able to continue purchasing shares at artificially low prices, allowing him to underpay by at least $150 million for shares he purchased after his beneficial ownership report was due,” lawyers for the SEC wrote in the January 2025 complaint.
In the settlement reached on Monday, Musk’s revocable trust made the deal without admitting or denying the allegations, the SEC said.
Musk’s lawyer, Alex Spiro, is celebrating the settlement as a win for Musk.
“Mr. Musk has now been cleared of all issues related to the late filing of forms in the Twitter acquisition, as we said from the outset he would be,” Spiro said in a statement. “A trust vehicle has agreed to a small fine for being late on one filing.”
The parties reached the settlement just over a year and a few months after former President Joe Biden‘s SEC filed the complaint as part of the administration’s regulatory approach.
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Musk recently reached a settlement with the California Coastal Commission over a SpaceX lawsuit this month, as well.
Musk is also currently involved in another lawsuit with OpenAI CEO Sam Altman over the company’s founding mission. Musk helped found OpenAI with a group of tech giants, including Altman, but he now runs xAI.
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