Thanks to his controversial tweets about taking Tesla private a couple of months ago, Elon Musk is now being charged by the US Securities and Exchange Commission for securities fraud. On the 8th of August, Musk tweeted to his 22 million followers that he could take Tesla private at $420 a share (a 20% premium) and has secured private funding for it.
Am considering taking Tesla private at $420. Funding secured.
— Elon Musk (@elonmusk) August 7, 2018
“Corporate officers hold positions of trust in our markets and have important responsibilities to shareholders,” said Steven Peikin, Co-Director of the SEC’s Enforcement Division. “An officer’s celebrity status or reputation as a technological innovator does not give license to take those responsibilities lightly.”
“Taking care to provide truthful and accurate information is among a CEO’s most critical obligations,” added Stephanie Avakian, Co-Director of the SEC’s Enforcement Division. “That standard applies with equal force when the communications are made via social media or another non-traditional form.”
This action drove the price of Tesla’s shares down by 7% overall but Musk has released a statement regarding the charge.
This unjustified action by the SEC leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way – Elon Musk
Tesla and their board of directors as well have responded in support of Musk.
Tesla and the board of directors are fully confident in Elon, his integrity, and his leadership of the company, which has resulted in the most successful US auto company in over a century. Our focus remains on the continued ramp of Model 3 production and delivering for our customers, shareholders and employees – Joint Statement from Tesla and the Board of Directors