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Elon Musk agrees to testify in SEC probe of $44 billion Twitter deal

An AI rendition of Elon Musk in court

Billionaire Elon Musk has agreed to testify in the Securities and Exchange Commission (SEC) probe on the deal to buy Twitter for $44 billion.

The SEC, a regulatory body known for its thorough investigations, had initially pressured Musk on multiple attempts to uncover the truth about the deal behind the 2022 social media platform sale.

The regulator filed a subpoena for Musk in October 2023 after he failed to give information to the investigation into the purchase. Rumors had surfaced that the money used to drum up the deal to buy Twitter might have bent a few of the SEC’s rules.

The statement said the “testimony subpoena to Musk relates to an ongoing investigation by the SEC regarding, among other things, potential violations of various provisions of the federal securities laws in connection with (a) Musk’s 2022 purchases of Twitter, Inc. (“Twitter”) stock, and (b) Musk’s 2022 statements and SEC filings relating to Twitter. According to the filing, the SEC seeks Musk’s testimony to obtain information not already in the SEC’s possession that is relevant to its legitimate and lawful investigation.”

Musk to testify

The ongoing investigation into potential serious violations of U.S. securities laws by Musk and those involved in the Twitter deal has rumbled into 2024. The latest update to the case was filed in the U.S. District Court for the Northern District of California.

The court filing said:

“Musk failed to appear for testimony on September 15, 2023, as required by the investigative subpoena served by the SEC, despite:

(1) in May 2023, agreeing to appear for testimony on a date nearly four months later, in September 2023, (2) having been served with a subpoena in May 2023 requiring his appearance for testimony in the SEC’s San Francisco regional Office on that mutually agreed upon date in September, (3) raising no objection to the subpoena at the time it was served or during the following months, and (4) approximately two weeks before his scheduled testimony, requesting and receiving an accommodation to move his scheduled testimony by one day. Instead, two days before his scheduled testimony, Musk abruptly notified the SEC staff that he would not appear. Musk attempted to justify his refusal to comply with the subpoena by raising, for the first time, several spurious objections, including an objection to San Francisco as an appropriate testimony location.”

Musk managed to avoid the SEC’s questions last year but will now have to testify in court under a government watchdog’s grilling after the legal issues have escalated.

Musk’s rocky 2024

Musk and Tesla have faced financial and public hurdles since the end of last year. As we reported, Tesla had slashed the price of their marquee electric vehicles and conducted mass layoffs.

Further to Musk’s claims to be a leader in the artificial intelligence scene, his AI company had to spend a significant amount to keep its top workers.

This is a polar opposite to the 14,000 workers who were axed from the company, including senior executives from the landmark Tesla Supercharger Team.

It remains to be seen if the SEC will find Musk guilty of any rule-breaking in the purchase of Twitter. However, they certainly won’t hold back once they have the billionaire under oath and the spotlight of a U.S. court’s questions.

Image: Ideogram.

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