{"id":2631,"date":"2018-09-27T22:51:35","date_gmt":"2018-09-27T22:51:35","guid":{"rendered":"http:\/\/www.styledeals.co.uk\/blog\/regulators-accuse-teslas-elon-musk-of-securities-fraud\/"},"modified":"2018-09-27T22:51:35","modified_gmt":"2018-09-27T22:51:35","slug":"regulators-accuse-teslas-elon-musk-of-securities-fraud","status":"publish","type":"post","link":"https:\/\/www.styledeals.co.uk\/blog\/regulators-accuse-teslas-elon-musk-of-securities-fraud\/","title":{"rendered":"Regulators accuse Tesla&#8217;s Elon Musk of securities fraud"},"content":{"rendered":"\n<div property=\"articleBody\">\n<figure class=\"media-landscape no-caption full-width lead\"><span class=\"image-and-copyright-container\"><\/p>\n<p>                <img loading=\"lazy\" decoding=\"async\" class=\"js-image-replace\" alt=\"Elon Musk\" src=\"https:\/\/ichef.bbci.co.uk\/news\/320\/cpsprodpb\/176EC\/production\/_103608959_elonmusk2.jpg\" width=\"976\" height=\"549\"\/><span class=\"off-screen\">Image copyright<\/span><br \/>\n                 <span class=\"story-image-copyright\">Scott Olson\/Getty Images<\/span><\/p>\n<p>            <\/span><\/p>\n<\/figure>\n<p class=\"story-body__introduction\">The Securities and Exchange Commission has filed a lawsuit accusing Tesla boss Elon Musk of securities fraud.<\/p>\n<p>The US financial regulator says Mr Musk&#8217;s claims that he had secured funding to take the electric carmaker private were &#8220;false and misleading&#8221;.<\/p>\n<p>It is seeking to bar Mr Musk from acting as an officer or director of a publicly traded company.<\/p>\n<p>Mr Musk called the action &#8220;unjustified&#8221; saying he acted in the &#8220;best interests of truth, transparency and investors&#8221;.<\/p>\n<p>&#8220;Integrity is the most important value in my life and the facts will show I never compromised this in any way,&#8221; he said in a statement.<\/p>\n<ul class=\"story-body__unordered-list\">\n<li class=\"story-body__list-item\"><a href=\"https:\/\/www.bbc.com\/news\/business-45560987\" class=\"story-body__link\">The weird and wonderful life of Elon Musk<\/a><\/li>\n<li class=\"story-body__list-item\"><a href=\"https:\/\/www.bbc.com\/news\/business-45134768\" class=\"story-body__link\">Tesla&#8217;s Elon Musk in the hot seat, again<\/a><\/li>\n<\/ul>\n<p>Mr Musk startled the business world last month when he took to Twitter to announce that he was considering a plan that would de-list the company from the stock exchange.<\/p>\n<p>He wrote he had &#8220;funding secured&#8221; for the proposal, which would value Tesla at $420 per share.<\/p>\n<figure class=\"media-landscape has-caption full-width\"><span class=\"image-and-copyright-container\"><\/p>\n<p>                 <span class=\"off-screen\">Image copyright<\/span><br \/>\n                 <span class=\"story-image-copyright\">Getty Images<\/span><\/p>\n<p>            <\/span><figcaption class=\"media-caption\"><span class=\"off-screen\">Image caption<\/span><br \/>\n                <span class=\"media-caption__text\"><br \/>\n                    Mr Musk, known for his bold claims, has inspired passionate fans and critics<br \/>\n                <\/span><br \/>\n            <\/figcaption><\/figure>\n<p>The statements &#8220;created the misleading impression that taking Tesla private was subject only to Mr Musk choosing to do so and a shareholder vote&#8221;, according to the SEC complaint, which was filed on Thursday in federal court in New York.<\/p>\n<p>&#8220;In truth and in fact Musk had not even discussed, much less confirmed, key deal terms, including price, with any potential funding source,&#8221; it said.<\/p>\n<p>The 7 August tweets took even people within the company by surprise.<\/p>\n<p>&#8220;Was this text legit?&#8221; the firm&#8217;s head of investor relations wrote to Mr Musk&#8217;s chief of staff, the complaint says.<\/p>\n<h2 class=\"story-body__crosshead\">&#8216;Significant confusion&#8217;<\/h2>\n<p>Tesla shares soared after Mr Musk&#8217;s announcement, before retreating amid questions and doubts.<\/p>\n<p>Weeks later, Mr Musk backed away from the plan, citing investor feedback.<\/p>\n<p>The SEC, which is also seeking financial penalties, said his claims created &#8220;significant confusion&#8221; in the stock market and harmed investors.<\/p>\n<figure class=\"media-with-caption\">\n<div class=\"player-with-placeholder\">\n            <img decoding=\"async\" class=\"media-placeholder player-with-placeholder__image narrative-video-placeholder\" src=\"https:\/\/ichef.bbci.co.uk\/images\/ic\/720x405\/p06mbds5.jpg\"\/><\/p>\n<p>Media playback is unsupported on your device<\/p>\n<\/p><\/div><figcaption class=\"media-with-caption__caption\"><span class=\"off-screen\">Media caption<\/span>Tesla&#8217;s Elon Musk &#8216;mislead investors&#8217; SEC alleges<\/figcaption><\/figure>\n<p>&#8220;Taking care to provide truthful and accurate information is among a CEO&#8217;s most critical obligations,&#8221; said Stephanie Avakian, co-director of the SEC&#8217;s enforcement division.  <\/p>\n<p>&#8220;That standard applies with equal force when the communications are made via social media or another non-traditional form.&#8221;<\/p>\n<p>The SEC complaint sent shares of the firm down by more than 10% in after-hours trade.<\/p>\n<hr class=\"story-body__line\"\/>\n<p><strong>Analysis &#8211; Dave Lee, BBC North America technology reporter, San Francisco<\/strong>:<\/p>\n<p>Whatever the state of mind Elon Musk was in when he announced he had &#8220;funding secured&#8221;, it could end up costing almost everything he holds dear. It would be nobody&#8217;s fault but his own.<\/p>\n<p>Wall Street veterans &#8211; and indeed, anyone with a modicum of knowledge of how the financial markets work &#8211; predicted this very scenario the moment those tweets were posted.<\/p>\n<p>Mr Musk is famously an unconventional chief executive, but when it comes to the financial markets, you can&#8217;t flout the rules without serious consequences.<\/p>\n<p>It&#8217;s clear, from emails contained in the SEC&#8217;s filing, that staff at Tesla were caught completely off guard. His head of investor relations asked if the tweets were &#8220;legit&#8221;. The Nasdaq, confused, halted trading. It all makes Mr Musk unfit to run a public company, the SEC says. <\/p>\n<p>All this because of a tweet sent because Mr Musk thought his girlfriend &#8220;would find it funny&#8221;.<\/p>\n<hr class=\"story-body__line\"\/>\n<figure class=\"media-landscape has-caption full-width\"><span class=\"image-and-copyright-container\"><\/p>\n<p>                 <span class=\"off-screen\">Image copyright<\/span><br \/>\n                 <span class=\"story-image-copyright\">Getty Images<\/span><\/p>\n<p>            <\/span><figcaption class=\"media-caption\"><span class=\"off-screen\">Image caption<\/span><br \/>\n                <span class=\"media-caption__text\"><br \/>\n                    Supporters credit Mr Musk with pushing the car industry toward electric vehicles<br \/>\n                <\/span><br \/>\n            <\/figcaption><\/figure>\n<p>Mr Musk, who co-founded Tesla and has served as chief executive since 2008, is a divisive figure in the business world, who has inspired passionate fans and critics.<\/p>\n<p>Supporters credit Mr Musk, also the head of the rocket company SpaceX, with pushing the car industry to produce electric cars.<\/p>\n<ul class=\"story-body__unordered-list\">\n<li class=\"story-body__list-item\"><a href=\"https:\/\/www.bbc.co.uk\/news\/science-environment-45550755\" class=\"story-body__link\">Elon Musk unveils first tourist for SpaceX &#8216;Moon loop&#8217;<\/a><\/li>\n<li class=\"story-body__list-item\"><a href=\"https:\/\/www.bbc.co.uk\/news\/world-us-canada-45551895\" class=\"story-body__link\">Elon Musk sued for libel by British Thai cave rescuer<\/a><\/li>\n<\/ul>\n<p>But his critics &#8211; including many who have made investments predicting the firm&#8217;s stock will fall &#8211; argue that Tesla has consistently lost money and struggled to increase its output, repeatedly missing its own targets.<\/p>\n<p>The financial pressure facing Tesla has mounted this year, as it boosts spending to increase production of its newest car.<\/p>\n<h2 class=\"story-body__crosshead\">&#8216;Erratic behaviour&#8217;<\/h2>\n<p>In recent months, Mr Musk&#8217;s own behaviour has also been in the spotlight.<\/p>\n<p>In July, he drew widespread criticism after accusing a British cave diver involved in the rescue of Thai teenagers from a flooded cage of being a child abuser.<\/p>\n<p>The diver later filed a defamation suit.<\/p>\n<p>He also drew attention after an emotional interview with the New York Times, in which he said he worked &#8220;120-hour weeks&#8221; and took sedatives.<\/p>\n<p>And earlier this month, he smoked marijuana live on the web during a podcast with comedian Joe Rogan.<\/p>\n<\/p><\/div>\n<p><br \/>\n<br \/><a href=\"https:\/\/www.bbc.co.uk\/news\/business-45672813\">Source<\/a> by <a href=\"\">[author_name]<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Image copyright Scott Olson\/Getty Images The Securities and Exchange Commission has filed a lawsuit accusing Tesla boss Elon Musk of securities fraud. The US financial regulator says Mr Musk&#8217;s claims that he had secured funding to take the electric carmaker private were &#8220;false and misleading&#8221;. It is seeking to bar Mr Musk from acting as &hellip; <\/p>\n","protected":false},"author":0,"featured_media":2632,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2631","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/2631","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=2631"}],"version-history":[{"count":0,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/2631\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media\/2632"}],"wp:attachment":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=2631"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=2631"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=2631"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}