SEC publishes letter asking Elon Musk to explain late Twitter filing
The US financial watchdog has contacted Elon Musk about the disclosure of his stake in Twitter, asking the Tesla chief executive why he appeared to file a crucial form late.
The Securities and Exchange Commission published a letter sent to the world’s richest man in which it asks a series of questions about how he declared his acquisition of a 9.2% stake on 4 April. The move prompted a flurry of corporate activity that led to Twitter accepting a $44bn (£35bn) takeover bid from Musk on 25 April – although he has since announced that the deal is “on hold” while he seeks more information about the proportion of fake accounts on Twitter.
In the 4 April letter, the SEC asked why a schedule 13G form announcing Musk’s acquisition of a large shareholding “does not appear” to have been filed within the required 10 days of the stake passing the 5% level where it needs to be disclosed publicly. According to Musk’s own filing, he passed the 5% level on 14 March and therefore should have filed the form by 24 March.
“Please advise us why the schedule 13G does not appear to have been made within the required 10 days from the date of acquisition as required by rule 13d-1©, the rule upon which you represented that you relied to make the submission,” said the SEC in the letter, dated 10 days before Musk announced his takeover bid.
The SEC said that once it had reviewed Musk’s reply it “may have additional comments”. In 2018, Musk reached a settlement with the SEC over a tweet in which he said was considering taking Tesla off the stock market and into private ownership and had “funding secured” for the proposal.
Investors filed a lawsuit against Musk on Wednesday in which they claimed Musk had saved himself $156m by failing to disclose that he
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