Tesla Inc. (NASDAQ:TSLA) CEO Elon Musk has agreed to settle the U.S. Securities and Exchange Commission lawsuit over his delayed disclosure of Twitter stock purchases, paying a $1.5 million civil penalty while retaining an alleged $150 million in gains.
SEC Case Over Musk's Twitter Stake Disclosure
The settlement, filed Monday in federal court in Washington, resolves allegations that Musk waited 11 days too long in 2022 to disclose that he had surpassed the 5% ownership threshold in Twitter, Reuters reported.
The SEC argued the delay allowed Musk to continue buying shares at artificially low prices before publicly revealing his growing stake, ultimately saving him roughly $150 million.
Musk did not admit wrongdoing as part of the agreement and the settlement still requires judicial approval.
SEC did not immediately respond to Benzinga’s request for comments.
Musk's Legal Team Declares Victory
Attorney Alex Spiro said Musk had been "cleared," maintaining that the delayed filing was inadvertent rather than deceptive.
The SEC had originally sought both financial penalties and repayment of Musk's alleged savings.
Instead, the final agreement imposes what legal experts describe as a relatively modest fine compared with Musk's wealth. The tech mogul currently has a net worth of $789.9 billion, according to Forbes.
SEC Battle Continues To Shape Musk's Regulatory History
The case adds to Musk's turbulent history with the SEC, which began with the 2018 "funding secured" settlement tied to Tesla.
Amanda Fischer, former chief of staff to Gary Gensler, criticized the agreement as "embarrassing."
She said it could raise concerns about whether the regulator is adequately protecting ordinary investors over politically connected insiders.
Separate Shareholder Litigation Remains
The SEC settlement does not affect Musk's ongoing legal challenges tied to shareholder claims over his Twitter acquisition strategy.
Musk completed his $44 billion Twitter takeover in October 2022, later rebranding the platform as X.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Frederic Legrand – COMEO from Shutterstock
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