Yerevan (CoinChapter.com) - The U.S. Securities and Exchange Commission (SEC) sued Elon Musk, claiming that he violated U.S. securities laws by failing to timely disclose his purchase of shares in Company X. According to an SEC filing on January 14, Musk failed to report that he held more than 5% of shares in Company X by the required deadline in early 2022.


SEC details alleged financial gains
The SEC filing outlines Musk's stock purchases beginning in early 2022 and notes that he exceeded the 5% ownership threshold by March 14, 2022. However, Musk continued to buy shares without disclosing his holdings. Between March 24 and April 4, 2022, he is alleged to have acquired X shares at lower prices, avoiding costs of at least $150 million.

“Musk’s failure to promptly disclose his equity ownership deprived other investors of the opportunity to act on material information,”
The SEC said it accused Musk of buying X shares at a lower price by taking advantage of the delayed disclosure.
In addition, the SEC requested a jury trial and required Musk to disgorge his profits and pay civil penalties.
Musk and his lawyers respond to the allegations
Musk publicly responded to the lawsuit in a January 15, 2022 post, calling the SEC a "completely broken institution."


Musk's lawyer, Alex Spiro, also issued a statement on the lawsuit, calling the SEC's lawsuit "petty accusations" and saying it represents years of targeting Musk.

"Mr Musk did nothing wrong, and everyone sees that,"
Spiro said.
Background on the X (Twitter) acquisition
It is worth noting that Musk officially acquired Twitter for $44 billion on April 25, 2022. After the acquisition, he renamed the company X, fired its senior executives, and laid off most of the employees. These changes have led to regulatory scrutiny in regions such as Europe and Australia.
The SEC's lawsuit adds to a growing list of legal challenges facing Musk.