'Shortseller Enrichment Commission’? Musk mocks SEC over fraud probe

Last week Musk settled the securities fraud charge from the SEC, following his tweet in August about potentially taking Tesla private.

Sent via Twitter for iPhone. The company's board reportedly hasn't had any serious discussions on who will replace Musk, but some board members have thrown their support behind James Murdoch who is the son of Rupert Murdoch and the CEO of 21st Century Fox.

"Keep it coming, Elon", one person said.

According to the SEC, Tesla must create a committee of independent directors and "put in place additional controls and procedures to oversee Musk's communications", including on platforms like Twitter. The settlement was announced on September 29, two days after Musk was charged. "He wasn't vindicated, and it is needling at him. Mission accomplished for the shorts".

But the deal didn't prevent the free-wheeling Musk from continuing to speak out about other subjects - a liberty he took advantage of to bash the SEC in a Thursday tweet that indicated he is still stewing about the allegations filed against him. Musk responded, in part: "Hang in there". He "liked" another user's tweet on Thursday calling for the judge to "dismiss this frivolous attack and shame the SEC". The SEC alleged that Musk hadn't locked up the estimated $25-billion to $50-billion that it would have required to pull off that deal.

After determining that the tech entrepreneur was guilty of misleading investors when he tweeted that that he had secured funding to take Tesla private, federal regulators reached out to the electric vehicle maker to discuss a suitable punishment. But that doesn't mean Tesla's board can't order Musk to tone done his Twitter posting in the best interests of the company. The proposed take-private price was $420 a share. This invited speculation he may have been referring to "operating profit positive", hours after Tesla wrapped up the end of a quarter in which he's predicted the company will post positive net income.

Thomas Gorman, a partner at Dorsey & Whitney in Washington, D.C., said Musk might argue that the latest tweet might be a mere "personal lament", and not a violation of the settlement. "They may feel the need to ramp up the terms".

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