Elon Musk laughed at the Commission issued him a $ 20 million fine
- Author: Eleanor Harrison Oct 07, 2018,
Oct 07, 2018, 1:49
But Musk and Tesla might not even be out of the woods yet.
The posts may test the boundaries of Musk's agreement not to deny wrongdoing and risk reviving stiffer forms of punishment. The commission seeks a permanent injunction, disgorgement, civil penalties and to prohibit Musk from serving as an officer or director of a public company.
But regulators made a decision to balance the penalty for violating securities law with investors' fervor for Musk, who is Tesla's "animating force".
"Musk is still the CEO and his friends still control the board, so tell me what really changed", said Lynn Turner, a former chief accountant of the Securities and Exchange Commission, in an interview with Business Insider.
Last month, the SEC filed a lawsuit against Musk after an August tweet in which he said he was considering taking the company private. According to the SEC, Musk had no discussion about specific deals with potential financing partners and that he knew the potential transaction was uncertain.
"Mr. Musk has excellent attorneys", said Marc Leaf, a partner at Drinker Biddle & Reath in NY who used to work for the SEC as an adviser to a commissioner.
The agreements implicitly allow Musk to be involved in both of those sets of choices. If the settlement is struck down, the SEC would likely move towards enforcement-it's unlikely they would be as lenient in that case.
While the board has not engaged in any "serious" discussions of who should be the chairman, some members of Tesla's board of directors have proposed 21st Century Fox CEO James Murdoch take over the role of chairman following Elon Musk's settlement with the Securities and Exchange Commission.
Musk is a bit too witty for his own good.
"The SEC stayed away [from] the broader corporate governance and management issues", Turner said. It is also unclear whether this money will be used to cover Musk's $20 million SEC fine. Neither can ask that they be paid out of the company's insurance policies.
Musk's defiance on Twitter, where he has 22 million followers, could prove risky or unwise: Regulators had pushed to bar him from leading the company, and could do so again if they feel Musk or the company have not abided by the deal.