The US Securities and Exchange Commission (SEC) sued the American billionaire Ilon Mask for violations that were allegedly committed when acquiring the Twitter social network, which was later renamed in x.
The SEC lawsuit filed in Washington, states that Musk violated federal laws on securities, as he did not provide a timely report on the purchase of more than 5 percent of Twitter shares in March 2022. It is noted that as a result, Musk was able to continue buying stocks at low prices, which allowed him to underpay at least $ 150 million.
The case file states that Musk began to acquire a significant share of Twitter shares in early 2022, and by March 14, 2022 it already owned more than 5 percent of the company’s issues.
According to the current legislation, there is an obligation to notify the SEC within ten calendar days after the exceeding the 5 percent threshold of ownership of shares, while Musk did not. The document notes that eleven days after the specified period, that is, April 4, 2022, Musk announced the acquisition of more than 9 percent of Twitter shares. It is reported that on the same day the cost of Twitter shares increased by more than 27 percent.
The lawsuit states that at the time when Musk postponed the submission of a notification, investors sold Twitter shares at artificially low prices, which caused significant economic damage.
The US Securities and Exchange Commission requires the court to oblige the mask to pay a fine and return the illegally received income from the purchase of shares.