The U.S. Securities and Exchange Commission (SEC) has escalated its investigation into Elon Musk’s acquisition of Twitter, filing a lawsuit to compel his testimony. According to the SEC, Musk did not comply with a subpoena to testify in September, and the agency is now seeking legal action to force his cooperation.
The investigation centers around Musk’s purchase of Twitter shares in the lead-up to his acquisition of the social media platform, now known as “X,” for approximately $44 billion last October. The SEC is examining whether any individuals involved in the Twitter stock transactions committed securities fraud.
In its legal filing, the SEC stated that Musk’s refusal to comply with the agency’s administrative subpoena has hindered and delayed their investigation into potential violations of federal securities laws. Despite multiple attempts to schedule a meeting with Musk, including offering to meet near his current residence in Texas, Musk has consistently declined to appear for testimony. (via Bloomberg)
Musk’s attorney, Alex Spiro, argues that the SEC has already taken Musk’s testimony multiple times during this investigation and believes that it has become excessive. Additionally, Musk had initially raised objections, including the location of the testimony, but later agreed to an interview. However, he ultimately refused to meet at all.
The SEC’s move to enforce a subpoena is a significant step, and legal experts suggest that the courts often side with the regulator in such cases. This investigation is just the latest in a series of encounters between Musk and the SEC, dating back to his tweets about taking Tesla private in 2018, which resulted in a $20 million fine and other penalties.