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Elon Musk Pulled Out of Settlement With SEC At Last Minute (cnbc.com)
Sources have shared some new details with CNBC relating to the recent SEC charges against Tesla CEO Elon Musk. Yesterday, U.S. securities regulators sued Musk for allegedly making false statements related to his abandoned efforts to take Tesla Motors private. Now, according to CNBC, Tesla and the SEC were close to a no-guilt settlement but Elon Musk pulled out at the last minute. From the report: Under the deal, Musk and Tesla would have had to pay a nominal fine, and the CEO would not have had to admit any guilt, the sources said. However, the settlement would have barred Musk as chairman for two years and would require Tesla to appoint two new independent directors, CNBC's David Faber, citing sources. Musk refused to sign the deal because he felt that by settling he would not be truthful to himself, and he wouldn't have been able to live with the idea that he agreed to accept a settlement and any blemish associated with that, the sources said. Musk called the SEC's allegations "unjustified" and that he acted in the best interests of investors. "Tesla and the board of directors are fully confident in Elon, his integrity, and his leadership of the company, which has resulted in the most successful U.S. auto company in over a century. Our focus remains on the continued ramp of Model 3 production and delivering for our customers, shareholders and employees," said Tesla's board of directors in a statement.
Rockets.
Slick Cars. (in space)
Big Drills.
Flamethrowers.
Playing Chicken with the SEC.
Do I see a thrill junkie?
But now probably forced out from ANY executive position in the company. No CEO, COB, director, nada. Just a shareholder with no control of the company... I guess this is outsmarting the shorts?
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
When Musk opened his mouth I wrote that the SEC would give him a can of whoop ass and they will and they will win. Elon Musk is done for with this company and ALL U.S. based companies. His life as a CEO, director, or any officer of any business is coming to an end very shortly. He will be convicted and it will not be two years for his life. An idiot from birth.
All of this just because the financial system is a POS and some short shorts shorters got their panties too short and bunched up in their crack. Typical sad moment for humanity as a whole.
Musk has good ideas. His companies do some cool shit.
He is loosing it.
He should have taken this deal.
-no admission of wrongdoing.
-minor (for a billionaire) fine.
-step down as chairman (can remain as president/CEO) for 2 years.
-appoint 2 independent board members.
That is not a bad deal. It is a very slight slap on the wrist.
Of course, there will be a different deal negotiated... but in the mean time the company is suffering due to the publicity generated by this misstep.
"You want to know how to help your kids? Leave them the fuck alone." -George Carlin
...and the shareholders pay. The shorts will finally get their man.
get out of the way or die
funny thing is, thatâ(TM)s what those of us who shorted Tesla were betting on. :)
Good for him. That's what he should have done.
Sooo... the SEC offers him a mere slap on the wrist, and he throws it back in their face?
Ruh roh.
Good luck with that, Elon. You're gonna need it.
If Elon had actually secured the funding, he could make Tesla a private company.
If Elon had actually secured the funding, he wouldn't be in trouble with the SEC.
If Elon wasn't in trouble with the SEC, he wouldn't need to make Tesla a private company.
him.
Even the most sleazy catch-22 pseudo-outcry bullshit they can pull out of their asses.
And I say that as somebody who doesn't like Musk even a single bit. (He's riiight in the uncanny valley between human and psychopathic robot, that only Jimmy Fallon, he, and other true functioning psychopaths can be at. I'm talking about psychopathy as the mental illness with the inability to judge social situations and have empathy. Not the serial killer kind that movies want you to think everyone with that illness is.)
It's so brutally obvious, blatant and primitive, that "of course", not a single one of the loud idiots who believe they have an opinion won't jump onto the bandwagon to the big "scandal" dogpile.
And shit like this is exactly, why assholes dominate the so-called "people". Because those "people" are the hardest fighters in the fight against themselves. They will kill anyone who dares to give them freedom or rights, because their oppressors say so.
when you shake the status-quo, the owners of the market will do any possible move to shut you down....what's next? General strike because of the lack of organic coffee at Tesla coffee shop?
First, IANAL. With that said...
This is a civil action, not a criminal one. Thus, even if he loses Musk does not become a felon and (I'm pretty sure) doesn't lose the security clearance that he needs for his SpaceX activities.
The SEC can ban him from serving as CEO or chair of a publicly traded company; they can remove him from top spot at Tesla, but not from SpaceX which is privately held.
Contrary to what many imagine, Tesla would not implode without Elon Musk. He probably thinks it would, because monumental ego, but he's wrong. Tesla is already set up to be a gold mine, a money-printing machine. It's not just the Model 3 that's on track to be profitable, but also the utility-scale battery storage systems. They haven't got a lot of press, haven't generated much drama, but since the facility in Australia proved wildly successful, demand for those is going to explode.
If this investigation causes the stock to tank, I'll call it a great opportunity to buy in.
He committed fraud, black-letter regulation, that everybody and their dog knows about. I am not a business executive, I know all about it.
What you are saying is that since you think he's a cool guy, the law just doesn't apply,
You can side with anyone you want.
But it looks Muskeg will have much more time to micromanage Spacex and Boring Co.
Here's a great stock tip for you all: go long on Sanofi-Aventis (the creators of Ambien).
Somehow I think a lot of Ambien-Tweeting is in the cards.
How many companies, that we are supposed to be protected from, paid that pizzo to the SEC?
Forgot to add...
I believe the SEC will also need to prove that Musk *intended* to manipulate the stock price with his dumb tweet. (There's no law against just being dumb.) I don't think Musk actually was trying to manipulate the stock, and how they're going to make they're argument I'm not sure. This may not be the slam-dunk that some people expect.
Furthermore, the SEC action may cause far more upheaval in Tesla's stock price and more harm to investors than the incident they are suing over. Is that really sensible? But you know, they want to make an example... They've said as much. This is about regulatory muscle-flexing and generating headlines.
Never fuck with the SEC.
He committed fraud, black-letter regulation, that everybody and their dog knows about. I am not a business executive, I know all about it.
Really? You know all about it? Then by all means, tell us precisely who he was talking about when he said he had secured funding, and why you personally know (not believe, but know, the two are different) that it was a lie? Or really, go write an article on the subject and submit it to various news outlets, I'm sure someone will be happy to carry it.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
I'm a shareholder and I like what Elon has been doing, from day one. I really didn't even mind his pot smoking interview, or the loss of the candy-ass executives who walked out on him.
The SEC is the only thing with potential to really screw us investors over. The day traders and short sellers can all go to hell, along with the SEC, as far as I'm concerned.
any ?'s
We all know that this is a regulation. I have no idea whatever manipulation he was attempting.
What happens if this SEC civil lawsuit brings down the Tesla stock price to the point where Musk and others are able to more easily take the company private? Will the SEC investigate itself for stock manipulation? A truly entertaining possibility.
"Every time I see an adult on a bicycle, I no longer despair for the future of the human race." - H. G. Wells
I think it was back in December we stockholders got asked to approve a whopping great compensation package for Musk. To collect it I think he had to stay on as CEO for a certain amount of time and hit certain financial milestones. I think it was 10 years.
So if he takes this SEC "deal" and has to step down as CEO would he lose all that? I think so.
And I think it is bullshit. Imagine what would happen if Musk left. Nobody but the shorts (who are desperate for this to happen) would win because the stock would dive 40% minimum.
And I don't see what Musk did wrong. He said he had a deal. He never said he was taking it which would have been a board (and possibly stockholder) action anyway. The SEC is being totally arbitrary. Let them take it to court if they want to be embarrassed.
Elon's going to crash a bunch of his own companies!
Why?
For shits and giggles! WHY ELSE?
Chas - The one, the only.
THANK GOD!!!
A rational actor should have taken the slap on the wrist unless they have overwhelming evidence, evidence that isn't public. People aren't rational actors. Elon Musk sure as heck doesn't make comservative decisions after carefully calculating the benefits and risks - he goes all in on crazy stuff that just might work.
Literal moonshots are Elon's stock in trade. That's not a BAD thing, or a GOOD thing, it's simply Elon's thing.
Those are not official corporate statements, the tweet was and is and therefore subject to close SEC scrutiny. Some guy who is not actually trying to manipulate stock but states his opinion or analysis on the internet, regardless of if the statement is "true", is not subject to any sanctions -- note the word "unregulated" in your own statement. As well, investors know that such sources of information are not regulated and therefore don't rely on them nearly as much.
First, giving out false information to hurt the shorts is just as illegal as giving out false information to help the longs.
Second, people who bought the stock relying on his statement that funding was secured were hurt as the stock went down when the truth came out.
Third, there are many groups of people who you should never joke with in their official capacity - these include the FBI, the SEC, and Federal Judges.
Short selling is completely legal (just as futures trading is). It is not "gambling" as it is not primarily a game of luck, it is simply taking advantage of market opportunities with skill. In fact, it is an investment strategy that helps the market find the price of a stock - for example, the existence of a lot of short positions in a stock is something that is quite informative in that it tells those who are long that others are FAR more pessimistic and putting their money where their beliefs are. Why should anyone object to shorts? Either they are right (in which case longs should have listened to them and may have and bailed on the stock) or they are wrong and lose their shirts.
I suppose you think selling an investment property that has a large mortgage on it because you think the real estate market is about to crash is "gambling" and should also be illegal?
If the SEC, using legal definitions they understand well, believes it was an inaccurate statement based on what they have found in their investigation, the best bet is that it is. We, of course, don't have access to all the records the SEC got from Tesla about this so we are more in the dark than the SEC.
If hes an idiot then why are you not a self made billionaire?
Only the State obtains its revenue by coercion. - Murray Rothbard
Felon M. is a stock value manipulator. He has a long history of creating idealistic, hard-working people of their businesses, and a long history of luring investor money into pits of value destruction.
He's not a visionary, scientist or an engineer. He's a trickster, fraudster and a liar.
With a big ego and something in his closet.
What fraud? You mean that Tesla Model 3 sitting in my garage? The thousands of miles I've driven it haven't seemed like fraud, in fact it's been the nicest ride I've ever had in a 4 door sedan.
The only fraud committed has been by the short sellers and the anti-Tesla rabble-rousers like yourself.
Trump wants charismatic industry leaders to kowtow.
Read Mussolini's own writing. Trump did (really, he kept it in his bedside stand).
At one point in time il Duce was revered by the world for the fascist economic miracle.
Mussolini called it "corporatism". The governing paradigm is the state selects an elite set of corporate power brokers who receive favor, such as continuing to breath air, in return for supporting a benevolent patriacial dictatorship that masquerades as a democracy with a permenantly re-elected supreme leader.
it actually worked well up until Mussolini decided to invade Ethiopia and hitler copped his game plan. Then it went to shit for him.
Musk is the demo to all the other corporate charismatic leaders that you will pay if you don't kow tow to il Cheeto
Some drink at the fountain of knowledge. Others just gargle.
Can tromp their jackboots through these companies and remove the idea guy and cause them to implode. They don't seem to realize that he's really Tony Stark. Well, Tesla, SpaceX, Boring, etc. were all nice-to-haves, but will expect them to all go TU after the gov't figures out a way to whip him into a super-max for a few not-well-thought-out words in a tweet. Maybe they think he's some kind of D'nish D'Souza or somesuch. Persecution at the hands of big gov't I think to be becoming the norm rather than the exception.
I suppose you think selling an investment property that has a large mortgage on it because you think the real estate market is about to crash is "gambling" and should also be illegal?
Nope, selling something because it's overvalued is great. Sell away.
But playing games with short sales and manipulating the market with baseless accusations and character assassination to intentionally hurt a company and drive the stock price down is behaving like a vampire. It might be legal, but it isn't right. And we know that's exactly what a lot of people, including paid shills for Ford, GM, and big oil, have been up to.
Rei, you are up early. Lonely in Icenald?
Our founders intended a nation of LAWS written and passed by lawmakers in a legislative branch and signed into effect by an executive. Over the decades, our "lawmakers" have found a very convenient way to avoid any accountability for their actions: They pass a law creating some new executive agency (in this case, the SEC) and as part of that law they authorize the agency to write lots of rules and enforce them on the American people as if they were laws (which they are explicitly and manifestly NOT). Our entire modern political system is awash in rules and regulations being enforced as LAW even though NONE of it was ever written by any lawmakers, voted on by any lawmakers, or signed into effect by a president. Any time an agency gets greedy and starts abusing citizens, the senators and representatives say "don't blame ME! I didn't do it, some anonymous bureaucrat did it! Re-elect me and I'll look into fixing it!".
Musk has better things to do, like running SpaceX, Tesla, The Boring Company, etc but it would be nice if he chose to fight this on the following grounds:
1. Free Speech. The supreme law of the land is the Constitution which guarantees free speech, and his tweets were obviously NOT an official prospectus for investors. If any idiot in the financial markets is investing based on tweets, he is an idiot gambler and responsible for his own extreme speculation.
2. The SEC regulations were not written by congress - no member of the legislature will admit to having written every line of them.
3. The SEC regulations were not given to the president as a bill jointly passed through both the House and Senate, and were certainly never signed into effect by any American President.
4. Since these SEC regulations are not actual laws, they cannot rationally trump the basic law of the land, the Constitution.
5. Any congressional law creating an agency and granting it power to make rules enforceable as law is simply an unconstitutional subterfuge to save the congress from doing its most basic job and shield it from accountability. No average citizen can or does know the identities of the people writing and enforcing these rules and thus there is no political accountability.
People in the massive DC establishment would be freaked-out by a ruling on the above; they simply are so stewed in the corruption they cannot even imagine a world in which this scheme they are all used to is in effect. If it was in front of an actual conservative judge (as opposed to most of the fake conservatives who are status-quo addicts) it could get rather interesting. Time for a little judge shopping...
Well a sovereign wealth fund did agree to take Tesla private on reasonable terms. Musk just wanted to be transparent with the shareholders. Musk has a lot of integrity so he wont agree with the SEC's view that he was trying to manipulate stock when he was not. If the SEC wins it will just be another example of how unjust the American justice system is. This reminds me of the case of Aaron Swartz. https://en.wikipedia.org/wiki/Aaron_Swartz
Not sure if this shill shitposter is from Big Three carmakers, Big Aerospace, Big Oil, Big Labor, NASA, or some other sector.
Very hard to tell when there are so many butthurt large and powerful interests that Musk has out-competed, out-innovated, and just generally left in his dust wondering WTF just hit them.
The SEC is part of the US government which is the most corrupt it's been in 100+ years. I'd actually be more shocked to learn that this was NOT the result of government seeking to protect it's crony-capitalist partners in fleecing the US.
Coming up after the break: how they squared the circle followed by a peek at the fully functional perpetual motion machine. It's not a hoax, say boffins.
But now back to our main story - reports are coming in that Rei has actually shut the fuck up.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
over a decade ago I got a traffic ticket that was (in my view) bullshit. I didn't take it to court since, as a contractor, the hours lost would have cost me a lot more than the fine. Years later I can still feel pissed about that ticket.
You're probably right that taking the settlement would have been the rational thing to do. But I do understand him.
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Settlements should be banned out of principal.
The job of the SEC is to find instances of DELIBERATE attempts to manipulate the market. This includes putting out information that is known to be false or misleading.
Musk is entitled to keep people informed about his ideas and possible future plans. He is also entitled to just change his mind. Anything else would impede his ability to run his company.
IF, and this is a big if, the SEC can show pretty conclusively that Musk did what he did with the INTENT of manipulating the market, then they can punish him. If not, then they don't have a case and could be seen as harassing a successful businessman. They need to tread lightly unless they have compelling evidence of intent.
Given the SEC was so eager to make a deal that was pretty light, my bet is they seriously lack that PROOF of intent. I suspect that Musks lawyers know this and have advised him not to take the deal. If anyone would know, it is Musks lawyers so I think we will see the case dragged out a bit and then eventually dropped.
The problem is Tesla is practically the Apple of the EV car world, and in the same way Steve Jobs IS Apple, Elon Musk IS Tesla.
And we've seen what happened to Apple when they fired Jobs, and what's happening to Apple again now after Jobs passed away.
They're both asshole's, but they have/had strong visions of how they wanted to company to be and sometimes having that one strong vision is what you need to make a company work and focussed.
If they put anyone else in charge, they will be distracted with shit like profit and shareholders and what consumers want instead of making the vision happen, and that will cause them to decline just the way Apple descended into obscurity when they fired Jobs and the way Apple is again declining after he built the company back up again, since he passed away...
I think Musk knows this in one way or another and doesn't want to sacrifice the company that he's worked so hard to build...
I gotta love partying rapist fratboys.
If you have to put liquor in your Anus to get drunk, you do not need to be on the supreme court.
Truth isn't Truth - Guliani
The problem is, what Elon allegedly did is in fact illegal. Unlike in your case, the cost to send SEC the evidence is nothing compared to the cost of a settlement. So if he had any evidence that could exonerate him, he would've already used them, then SEC wouldn't have bothered charging him in the first place.
Except when the SEC and Musk/Tesla disagree on if the evidence exonerates him. They probably did provide the evidence and just disagree on what that means to the case.
The fact that the offered settlement is so far from what the SECs demands, suggests to me that the SEC isn't so sure about their case.
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Everything is illegal.
Tesla will be better off in the long term without more hostile board members, even if it means being without Elon.
Tesla's board is filled with Musk cronies that rubber stamp EVERYTHING he wants (They allowed that unethical purchase of Solarcity with TONS of debt.). The fact that they are supporting him now is just beyond asinine and corrupt.
Have any of you here actually looked at who they are? I bet not. NONE of them are qualified to be on the board of a car or energy company or any manufacturer for that matter. All of them are nothing but web designers and one guy who invested in ELon's X.com back during the dot-con era. Nothing but Elon's friends - that is their only qualifications.
They are nothing by Elon's puppets.
I found very strange that Elon Musk could be hit so hard so quickly for just a SMS that have at the maximum make some minor loss to a few investors. The SEC make far more damage to the Tesla value and shall be equally hit hard and quickly. The whole story is out of scale compared to the giant protection that many bank executive have enjoyed after the 2008 crisis that caused insanely high loss and million of people even more pore.
Short selling isn't fraudulent, and (as long as it is not naked), entirely legal.
Anyone watching the interviews with half a brain can see it: Elon needs to step back and take a break before he falls apart. If you ask me he's a world treasure. A higher chance of him being productive later is the best thing for us, for himself, and for his companies. Whether he takes this deal or not he should focus a higher percentage of his efforts on delegation. He should create a team of ten of the best engineers in the world and, yes, two board members and he should delegate more than half of his work to them.
If video games influenced behavior the Pac Man generation would be eating pills and running away from their problems.
> The fact that the offered settlement is so far from what the SECs demands, suggests to me that the SEC isn't so sure about their case.
I'm trying to figure out what you mean by this sentence?
The SEC offered a settlement, which Musk took, then changed his mind. It sounds like you're saying that what the SEC offered "is so far from what the SEC demands", which doesn't make any sense.
If you meant what the demand of people generally, they demad that people follow the law.
Are you trying to say the settlement is unusual? A very typical settlement would be "can't be a director or executive for five years", and some cash. So the person gets kicked out of the company they work for. In this case, it's only two years I think, but he has multiple companies, and he founded those companies, not just got hired by them. So on balance it's a pretty typical settlement.
What I meant is the difference between the settlement and what the SEC seeks for in court.
To me the difference between two years vs being barred from being a director/officer for any publicly traded company is quite big. But I guess this is usual in the US. Probably works well to scare people out of trying your luck in court
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I know all about it.
Really? You know all about it?
I have no idea whatever manipulation he was attempting.
Oh, so you know all about it, but you have no idea? Thanks for clearing that up for us.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
Must be. (f)Elon Musk is going to jail eventually!
USA #1! USA! USA! USA!
the pope? Why not go back to how the Fascists defined corporativism.
"Under fascist corporatism, sectors of the economy were divided into corporate groups, whose activities and interactions were managed and coordinated by the government. The idea was to split the difference between socialism and laissez faire capitalism, letting the state control and direct the economy from the top-down without itself owning the means of production. Mussolini's official title was "commander and chief of the economy" among others!
The National Council of Corporations was the government body in charge of managing Italy’s economy, and At its inauguration, Mussolini stated, “The [NCC] is to the Italian economy what the Chief of Staff is to the Army: the thinking brain that prepares and coordinates.”
The idea was that this body would negotiate contracts and centrally plan production throughout the economy, regulating the sectors of art, industry, agriculture, trade, comm-unication, transportation, and finance — thus settling disputes, producing social harmony, and generating economic efficiency.
In reality, it did none of this, and the system was used for rent-seeking, and to reward friends and crush enemies of the government."
http://blog.skepticallibertari...
Some drink at the fountain of knowledge. Others just gargle.
You are quoting a source from 1884 that is irrelevant to how mussolini defined it decades later.
Yes, to encourage settlements they settle for less than they'd ask for in court. If they didn't, it would bw foolish for anyone to settle.
Also with these kinds of things it's useful to watch out for phrasing like "facing up to five years". In that phrase, five years is rhe maximum penalty allowed under the law. That doesn't mean the prosecution would ask for the max. That's just the max they could ask for.
In this instance, Musk clearly and publicly said finding was secured at $420, and that seems to be a lie. So guilt is pretty clear. On the other hand, he didn't sell a bunch of stock the day after the announcement or something like that, so that's definitely a mitigating factor. He was trying to get press, to get attention for his company, not pump and dump. So a medium sentence might be appropriate.
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What happened to the usual suspects going AC?
Musk penis must have gone flaccid from all his legal troubles.
Elon, don't let the bastards grind you down.
But jumping into disasters in Purto Rico and Thailand for good PR is totally fine amirite?
And at one point buying and selling slaves was also perfectly legal, but it was never right.
Short selling is a race to the bottom in preserving the status quo. It should be dealt with under federal gambling laws.
I stand with Elon.