Elon Musk could be in hot water over Twitter stake disclosure
US regulators are investigating Elon Musk’s delayed disclosure of his sizeable stake in Twitter last month, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.
Musk disclosed a 9.2 per cent stake in Twitter to the US Securities and Exchange Commission (SEC) on April 4, a delay of at least 10 days since surpassing the 5 per cent threshold for revealing a shareholding, the report said. Filings revealed he passed that threshold on MArch 14.
An investor who crosses a 5 per cent stake must file a form with the SEC within 10 days. It serves as an early sign to stakeholders that a big investor could seek to control the company.
The SEC declined to comment on the report and the Tesla top boss did not immediately respond to a Reuters request for comment.
Apart from the delay, Musk’s April 4 filing also characterised his stake as passive, meaning he did not plan to take over Twitter or influence its management or business.
The next day, however, he was offered a position on Twitter’s board, and a couple of weeks later, the world’s richest man had clinched a $US44 billion deal to buy the social media giant.
Musk, known for his candid Twitter posts, has a long history of skirmishes with the SEC.
In 2018, he entered into a consent decree with the SEC for allegedly misleading investors when he tweeted that he had gathered enough funding to take Tesla, of which he is chief executive, private.
Musk paid a $US20 million fine and agreed to step down as chairman and vet his tweets with lawyers. Last month, he was criticised by a judge after asking the SEC to scrap that agreement.
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