US financial regulators are prosecuting Elon Musk for refusing to cooperate with their investigation into his purchase of X, after the billionaire stated he would no longer do so.
The Securities and Exchange Commission (SEC) has taken legal action against Elon Musk, requesting that a federal court compel him to participate in a third round of questioning regarding a business deal.
This move comes after Musk’s lawyer sent a letter stating that he refuses to comply with the SEC’s request, alleging harassment by the regulatory agency.
Musk’s attorney, Alex Spiro, argued that unchecked government actions are concerning and that Musk declines to cooperate with the SEC’s demands.
This lawsuit is the latest in a series of disputes between Musk and the SEC. Musk had previously expressed disdain for the regulator on national television.
The SEC initiated an investigation into Musk’s $44 billion acquisition of company X in the previous year. The investigation aims to determine if Musk’s stock purchases in 2022, prior to the acquisition, and the statements he made about these investments violated securities laws.
Musk had already participated in two half-day testimony sessions via video conference in July, following a subpoena from the SEC. However, the agency argues that another session is necessary because nearly half of the relevant documents were received after those initial meetings.
In response, Musk’s lawyer questioned why the SEC required more of Musk’s time, diverting him from his responsibilities to his companies and shareholders.
This legal clash is not the first between Musk and the SEC. In 2018, the SEC accused him of investor fraud due to a tweet in which he claimed to have “funding secured” to take Tesla, the electric car company he leads, private.
Musk settled the charges, stepping down as the firm’s board chairman and agreeing to limitations on his social media communications regarding the company.
Musk has repeatedly sought to have these limitations removed through court action, including a recent attempt in February. Additionally, a judge in New York recently ruled that Musk must face a lawsuit from former Twitter investors who allege that he defrauded them by not promptly disclosing his share purchases. However, an insider trading claim against him was dismissed.
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