Elon Musk and SEC Case

Elon Musk and SEC Case

Securities and Exchange Commission (SEC) filed a lawsuit against Tesla’s CEO, Mr. Elon Musk, for fraud. The filled lawsuit against Elon Musk came due to his tweet in August that he has already organized a deal to change Tesla into a private corporation. The Musk’s tweet brought complaints to SEC, alleging that Musk issued a misleading and false statement as well as failed to inform the material company invent regulators adequately. Some of the proposed settlement on Musk’s matter by SEC includes paying off $ 20 million fine and resigning from his CEO position of Tesla company when the court confirms the allegation against Musk is true (Matousek).

Generally, the CEO or chair of a public firm performs crucial duties to shareholders. The CEO’s responsibility includes the requirement to be careful and scrupulous on the accuracy and truth of statements made to the public investors. The information released must be accurate and correct regardless of the channel used to distribute the data, including Twitter, Facebook, and other social media platforms (Matousek). Also, considering the best interest of maintaining integrity, truth, and transparency of Tesla’s leadership, Musk’s false tweets are unjustifiable.

However, Elon Musk refuted the claim and lashed out the proposed settlement from Sec, claiming he will not respect the settlement leading to a legal battle at the court (Matousek). Musk’s potential defences of providing misleading and false information, including proving that the tweet was not misleading or fraudulent. Secondly, legally proving that you were unaware of making a false statement. Another possible defence claim is that the information given was not meant for public investors; therefore, there is nothing to worry about. However, to settle the matter, the judge will make the final decision in the law court.