Elon Musk says the SEC has ordered him to pay a fine over the Twitter purchase or face charges

New York
CNN
—

Elon Musk appears to have a final battle with Securities and Exchange Commission Chairman Gary Gensler.

Musk announced on his social media platform X that the agency is asking for an undisclosed amount to be fined in 2022 to cover expenses for initial stock purchases of what was then known as Twitter.

Musk published A letter from his attorney, Alex Spiro, to Gensler, in which the agency asked Musk to agree within 48 hours to pay a fine related to non-disclosure of the initial purchases of Twitter stock “or face multiple charges.”

“Oh Gary, how did you do this to me?” he said mockingly in the message.

The SEC and Gensler did not immediately respond to a request for comment.

The letter said SEC staff “recognized that this request was the result of a directive from superiors and that charges would be filed immediately unless approved by Mr. Musk.” The letter says Musk refuses to agree to the request.

Musk and the SEC have been at odds for years, including during Trump’s first term. But the feud has escalated in recent years, with Musk questioning the agency’s rights to limit communications with investors, and Gensler has become one of the most vocal critics of cryptocurrencies, in which Musk is a major investor and advocate.

Musk’s published letter also said he had received a subpoena to testify against Spiro, which he refused. He also said the agency had opened an investigation into another of Musk’s companies, Neuralink.

“This series of events makes it clear that the commission is not motivated to seek the truth, but is engaged in an improperly motivated campaign against Mr. Musk and the individuals and companies associated with him,” Spiro wrote in the letter. “We demand to know who directed these actions, whether it was you or the White House. We will not be intimidated by this wrong tactic and scheme.”

In 2018, the SEC reached a settlement with Musk and Tesla after finding that Musk misled investors when he tweeted that he had “guaranteed funding” to take Tesla private. Under that settlement, Tesla and Musk paid $20 million in fines, and Musk agreed to approve tweets about material company events by others at Tesla. He also relinquished the title of president of Tesla, although he retained the title of CEO. Musk later said he agreed to the deal because failure to do so would cut off vital sources of financing from banks that the then-cash-strapped Tesla needed to survive.

In April 2022, Musk announced that he had bought 9% of Twitter’s stock before buying the entire company later that year. The SEC sent him a letter wanting to know why he didn’t disclose those purchases within 10 days of passing the 5% threshold of ownership, as required by securities laws. Musk bought all of Twitter’s shares in a $44 billion purchase, and renamed it X shortly thereafter.

Musk and Gensler have also clashed over the regulation of cryptocurrencies, with Musk being a vocal advocate for what Gensler has described as securities that should be under the SEC’s purview. Gensler calls cryptocurrencies “ripe with fraud.” scams and abuses in some applications.”

But Musk, one of President-elect Donald Trump’s top supporters, won’t have to worry much longer about dealing with an SEC led by Gensler. Trump has appointed Paul Adkins, who has been chairman of the Digital Chamber’s Token Alliance crypto advocacy group since 2017, to lead the agency.