SEC scores pound of flesh

Took it right out of Elon Musk’s back, they did:

Elon Musk must step down as Tesla chair and pay a fine after reaching a deal with US regulators over tweets he posted about taking the firm private. It follows Thursday’s decision by the Securities and Exchange Commission (SEC) to sue Mr Musk for alleged securities fraud.

Under the deal, Mr Musk will remain as Tesla CEO but must step down as chairman for three years. Both he and Tesla will also have to pay a $20m (£15m) fine.

Under the terms of the deal, he will also have to comply with company communications procedures when tweeting about the firm.

The SEC deemed this statement to be fraud:

“Musk tweeted on August 7, 2018 that he could take Tesla private at $420 per share — a substantial premium to its trading price at the time — that funding for the transaction had been secured, and that the only remaining uncertainty was a shareholder vote,” the SEC said. “In truth, Musk knew that the potential transaction was uncertain and subject to numerous contingencies. Musk had not discussed specific deal terms, including price, with any potential financing partners, and his statements about the possible transaction lacked an adequate basis in fact.”

Before the markets closed for the weekend, Tesla stock fell to $264 a share.

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