This level of federal scrutiny was part of the reason why the SEC responded with a reminder to Musk. Musk was charged by the SEC with issuing false and misleading statements to investors after he said he had secured funding to take the company private. The SEC accused Musk of fraud after the deal never materialized. As part of the settlement, Musk was forced to step down as chairman of the board. Additionally, Musk paid a total of $40 million in fines and agreed to screen some of his social media posts through a securities law expert before publishing them online. The letter was sent to the federal judge overseeing the proceedings, accusing the SEC of using its resources to conduct investigations into the company and its CEO. The SEC seems to be targeting Mr. Musk because he is an outspoken critic of the government. The billionaire's exercise of his First seemed to be calculated to chill the regulator. The letter claimed that the SEC had broken promises by dragging its feet to distribute the settlement to shareholders.
In a letter to the courts Friday, the SEC's Stephen Buchholz said that the ongoing investigative activity was in line with the expectations of the court overseeing the settlement. In the years since the settlement, the SEC has written to the company multiple times asking why certain posts weren't screened. Musk, being the troll he is, also seems all too happy to keep poking the hornet's nest, antagonizing the SEC.
The SEC said that the process of getting money to shareholders should be finished within a month. It was noted that neither Musk nor the company had ever raised concerns about this matter before.
The plan of allocation is nearing completion and the staff expects to submit it.
Now that the SEC has responded to the allegations, it's not clear what the next steps will be. According to the Wall Street Journal, Judge Nathan asked the two sides to work through their dispute rather than throwing the matter back to the courts. That solution seems unlikely given Musk's penchant for legal battles.
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