SEC-Tesla Reaches Settlement on Elon Musk's Tweets, Elon Musk to Step Down as Chairman
September 30 , 2018
Securities and Exchange Commission (SEC) of the United States has reportedly settled charges with Tesla over its CEO Elon Musk’s claims over Twitter (in early August) to take the company private. SEC has found Musk’s comments (that he has secured enough funds for the private buyout of Tesla) as "false and misleading". In a statement, SEC chairman Jay Clayton said that the “companies and corporate insiders” must act responsibly while making public statements. Such a comment may be used by an investor for “making an investment decision”. Reports say the SEC-Tesla settlement on the issue will require Tesla to pay a fine of $20 million and also appoint 2 new directors (independent) to the board. As part of the deal, Elon Musk has to step down from the Chairman’s position in 45 days and he has to abide by the communications procedures of Tesla while tweeting about it.