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Blog Musk Settles SEC Fraud Charges, Will Step Down as Tesla’s Chairman

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Tesla Chief Executive Elon Musk will give up his chairman title under the terms of a settlement with the Securities and Exchange Commission related to fraud charges, according to a release.

Musk and Tesla have agreed to settle the charges against them without admitting or denying the SEC’s allegations. Among other relief, the settlements require that:



Musk will step down as Tesla’s Chairman and be replaced by an independent Chairman. Musk will be ineligible to be re-elected Chairman for three years;

Tesla will appoint a total of two new independent directors to its board;

Tesla will establish a new committee of independent directors and put in place additional controls and procedures to oversee Musk’s communications;

Musk and Tesla will each pay a separate $20 million penalty. The $40 million in penalties will be distributed to harmed investors under a court-approved process.



“The total package of remedies and relief announced today are specifically designed to address the misconduct at issue by strengthening Tesla’s corporate governance and oversight in order to protect investors,” Stephanie Avakian, Co-Director of the SEC’s Enforcement Division, said in a release.

According to the SEC’s complaint against him, Musk tweeted on August 7, 2018 that he could take Tesla private at $420 per share — a substantial premium to its trading price at the time — that funding for the transaction had been secured, and that the only remaining uncertainty was a shareholder vote. The SEC’s complaint alleged that, in truth, Musk knew that the potential transaction was uncertain and subject to numerous contingencies. Musk had not discussed specific deal terms, including price, with any potential financing partners, and his statements about the possible transaction lacked an adequate basis in fact. According to the SEC’s complaint, Musk’s misleading tweets caused Tesla’s stock price to jump by over six percent on August 7, and led to significant market disruption.

The settlement is subject to court approval.

 
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  • Like
Reactions: Ludalicious
What are you saying?

I just stated....clearly...….Its all about money.

Then you stated: I hate to break it to you....but Wall Street is all about money.


I also stated: There will never be an admission of any wrongdoing.

Then you stated: There will never be an admission...…..


Really?

I also said I don’t see your point. You don’t seem to have one. Or any evidence to refute anything in the article.

There’s nothing wrong with any of the things you mentioned.
 
The article is crap...…

Why is it important to talk about crap or justify anything using crap?

So your reasoning is that because the article contains things you probably don’t like, then the article is crap. And because the article is crap, then nothing contained in it is worth talking about. I assume you would never read such a crap article either. And then you post repeatedly trying to attack the article, that you have already pre-determined to be crap and not worth taking about.

Right... you see the numerous contradictions there? Let’s be adults and focus on the facts please and let’s not judge a book by its cover.
 
So your reasoning is that because the article contains things you probably don’t like, then the article is crap. And because the article is crap, then nothing contained in it is worth talking about. I assume you would never read such a crap article either. And then you post repeatedly trying to attack the article, that you have already pre-determined to be crap and not worth taking about.

Right... you see the numerous contradictions there? Let’s be adults and focus on the facts please and let’s not judge a book by its cover.
Nope....The article contains things that aren't TRUE....

Not things that I don't like.
 
  • Disagree
Reactions: R.S
Pulling from the Daily Trading Chart thread

For this reason, there should be little reason to doubt that the judge will approve the settlement and it will be behind us.


I still hold out hope the judge will approve a settlement, just not this settlement. 200x max penalty to Elon?. An arbitrary multiple to Tesla (not a natural person, and no profit from communication)?
SmartSelect_20181011-070839_Firefox.jpg



No indication from SEC why this is good for us, rather: it's fair because we say it is.


Meanwhile, the SEC case has dropped the stock more that the Tweet.


Great news. What's the source? I cant find details about this anywhere.


Link to link to settlement: TSLA Market Action: 2018 Investor Roundtable
 
Pulling from the Daily Trading Chart thread




I still hold out hope the judge will approve a settlement, just not this settlement. 200x max penalty to Elon?. An arbitrary multiple to Tesla (not a natural person, and no profit from communication)?
View attachment 342732


No indication from SEC why this is good for us, rather: it's fair because we say it is.


Meanwhile, the SEC case has dropped the stock more that the Tweet.





Link to link to settlement: TSLA Market Action: 2018 Investor Roundtable


Mongo,
I'd be delighted if the judge lessened the sentence or added words that cast doubt on any of the SEC's claims. Mostly, though, I hope to just get this SEC suit behind us and move on. I continue to believe that a rubber-stamp of the settlement is by far the most likely resolution.