Stories
Slash Boxes
Comments

SoylentNews is people

SEC Settlement: Elon Musk Resigns as Chairman of Tesla, Stays as CEO, $40 Million in Fines Paid

posted by martyb on Sunday September 30 2018, @12:09PM   Printer-friendly
from the make-stupid-tweet-pay-stupid-fine dept.

takyon writes:

Tesla and CEO Elon Musk will pay $40 million to settle SEC case

Tesla and Chief Executive Elon Musk have settled a Securities and Exchange Commission lawsuit that alleged the outspoken businessman misled investors about his prospective effort to take the electric-car company private.

Musk and the Palo Alto company agreed to pay a total of $40 million, and he will give up his chairmanship for at least three years. Musk, however, will remain chief executive and retain a seat on the company's board of directors. Tesla, meanwhile, is required to install an independent chairman and add two new board members, according to terms of the settlement, which the SEC announced Saturday.

Musk and Tesla will each pay $20 million to settle the case; both reached the deal without admitting wrongdoing. The company declined to comment.

The SEC charged Musk with fraud Thursday, alleging that his tweets about taking Tesla private — at $420 a share — were "false and misleading." As part of the lawsuit, it asked a federal court to remove him from the company's leadership and ban him from running a public company.

Also at Reuters.

SEC Settlement announcement.

Previously: Elon Musk Considers Taking Tesla Private
Elon Musk Accused by SEC of Misleading Investors in August Tweet [Updated]

Original Submission

 
This discussion has been archived. No new comments can be posted.
SEC Settlement: Elon Musk Resigns as Chairman of Tesla, Stays as CEO, $40 Million in Fines Paid | Log In/Create an Account | Top | 25 comments | Search Discussion
Display Options Threshold/Breakthrough Mark All as Read Mark All as Unread
The Fine Print: The following comments are owned by whoever posted them. We are not responsible for them in any way.

  • (Score: 4, Informative) by zocalo on Sunday September 30 2018, @04:41PM (1 child)

    by zocalo (302) on Sunday September 30 2018, @04:41PM (#742110)
    Agreed, it's a slap on the wrist fine. However, and perhaps I'm giving the SEC more credit than due here, perhaps they thought that Tesla without Musk might implode and wanted to try and ensure that didn't happen. Are members of the SEC investigating a company allowed to have shares in that company or have an obligation to think of the employeess, because this sure isn't a ruling that would have been made by someone shorting Tesla?

    Either way, the Tesla board now gets to appoint an "independent" Chairman on a three year contract, then as that term comes up they and Musk can decide whether or not to shuffle things around, which could potentially include returning to how things are now. If Teslas' current board are generally OK with how Musk is running the company then it seems pretty likely they are going to just appoint someone who feels pretty much the same way, so it'll probably end up being business as usual. If not, so what? Musk currently owns more shares than any other institution or individual (~33 million, or about 20% of the total, compared to CTO Jeff Straubel in 2nd place with just ~635,000), so it's highly likely he'll gets to decide how any board votes are going to go anyway.
    --
    UNIX? They're not even circumcised! Savages!
    Starting Score:    1  point
    Moderation   +2  
       Informative=2, Total=2
    Extra 'Informative' Modifier   0  
    Karma-Bonus Modifier   +1  
    Total Score:   4  

  • (Score: 0) by Anonymous Coward on Sunday September 30 2018, @06:19PM

    by Anonymous Coward on Sunday September 30 2018, @06:19PM (#742134)

    wanted to try and ensure that didn't happen.

    Try to do what?