Musk vs. the government Elon Musk slams SEC as agency threatens charges in Twitter stock probe SEC offered settlement in stock probe and is investigating Neuralink, Musk says. Jon Brodkin Dec 13, 2024 12:20 pm | 112 Elon Musk leaves federal court in New York on Thursday, April 4, 2019 after a hearing in a case involving the SEC. Credit: Getty Images | Bloomberg Elon Musk leaves federal court in New York on Thursday, April 4, 2019 after a hearing in a case involving the SEC. Credit: Getty Images | Bloomberg Story textSizeSmallStandardLargeWidth *StandardWideLinksStandardOrange* Subscribers only Learn moreElon Musk has at least one more battle to wage against Securities and Exchange Commission Chair Gary Gensler, who will be leaving the agency when President-elect Trump takes over in January.Musk yesterday posted a copy of a letter sent to Gensler by Musk's attorney, Alex Spiro. The letter dated December 12 says the SEC issued a settlement demand in its investigation into whether Musk violated federal securities laws in connection with 2022 purchases of Twitter stock, and that the SEC is investigating Neuralink. The Spiro letter said:Yesterday the Commission Staff issued a settlement demand that required Mr. Musk agree within 48 hours to either accept a monetary payment or face charges on numerous counts. They indicated that this demand was the result of a directive from their superiors and that charges would be brought imminently unless Mr. Musk acquiesced. This demand follows a multi-year investigation and more than six years of harassment of Mr. Musk by the Commission and its Staff. More recently, the Staff subpoenaed me, Mr. Musk's attorney, for testimony and threatened to send a process server if I did not immediately cooperate. I categorically refused. This week, the Commission has also reopened an investigation into Neuralink.Spiro accused the SEC of "an improperly motivated campaign" against Musk, his companies, and people associated with him. "We demand to know who directed these actionswhether it was you or the White House," Spiro wrote. "These tactics and misguided scheme will not intimidate us. We reserve all rights."Musk wrote in his post sharing the letter, "Oh Gary, how could you do this to me?" He wrote in an earlier post yesterday that "the SEC is just another weaponized institution doing political dirty work."Late disclosure of Twitter stock buyThe SEC began its investigation in April 2022 after Musk acquired a 9 percent stake in Twitter and failed to disclose it within 10 days as required under US law. He bought the company later that year.Musk previously tried to avoid giving a third round of testimony in the probe, but a federal judge ruled in December 2023 that he had to testify again. The SEC has said its investigation "relates to all of Musk's purchases of Twitter stock in 2022 and his 2022 statements and SEC filings."An SEC spokesperson told Ars today that the commission's policy is "to conduct investigations on a confidential basis to preserve the integrity of its investigative process. The SEC therefore does not comment on the existence or nonexistence of a possible investigation."A Reuters source confirmed the settlement offer. "The SEC sent Musk a settlement offer on Tuesday seeking a response in 48 hours, but extended it to Monday after a request for more time, the source said," according to a Reuters article today.The settlement offer was also confirmed by a source who spoke to The Washington Post. "One person familiar with the probe, who spoke on the condition of anonymity to describe a confidential law enforcement proceeding, confirmed that Musk had been sent a settlement offer in recent days," the Post wrote last night. "But the person said they believed the tech billionaire had actually been given until Monday to evaluate the offeradding that rejecting a settlement still would not immediately trigger charges by the SEC, which typically sends formal notices before such cases are brought."Musk has had several legal battles with the SEC. In 2018, he and Tesla each agreed to $20 million payments in a settlement over the SEC's complaint that "Musk's misleading tweets" about taking Tesla private caused the stock price to jump "and led to significant market disruption." He has tried and failed to get out of that settlement, claiming that he was "forced" into signing the deal and that the SEC used the 2018 consent decree to "micro-manage" his social media activity.Musk to have influence in Trump adminMusk won't have to worry as much about government regulation once Trump takes over. Trump picked Musk to lead a new Department of Government Efficiency, or "DOGE," which will make recommendations for eliminating regulations, cutting expenses, and restructuring federal agencies.As Reuters wrote today, Musk "is set to gain extraordinary influence after spending more than a quarter of a billion dollars to help Donald Trump win November's presidential election. His companies are expected to be well insulated from regulation and enforcement measures."The SEC's November announcement of Gensler's planned departure from the agency touted his work to adopt "several rules to ensure that investors get the disclosure they need from public companies and companies seeking to go public."Trump chose Paul Atkins to replace Gensler as SEC chair, calling Atkins an advocate "for common sense regulations." Atkins, a former SEC commissioner who founded the Patomak Global Partners consultancy firm, testified to Congress in 2019 that the SEC should reduce its disclosure requirements.Jon BrodkinSenior IT ReporterJon BrodkinSenior IT Reporter Jon is a Senior IT Reporter for Ars Technica. He covers the telecom industry, Federal Communications Commission rulemakings, broadband consumer affairs, court cases, and government regulation of the tech industry. 112 Comments