Elon Musk settles SEC lawsuit over Twitter disclosures

(Reuters) – Elon Musk settled the U.S. Securities and Exchange Commission’s civil lawsuit accusing the world’s richest person of waiting too long in 2022 to disclose his initial purchases of Twitter, now known as X.

A trust in Mr. Musk’s name will pay a $1.5 million civil fine, under the settlement disclosed on Monday in the Washington federal court.

He did not admit wrongdoing, and won’t have to give up any of the $150 million he allegedly saved from the delay.

The settlement requires approval by U.S. District Judge Sparkle Sooknanan, who in February rejected Mr. Musk’s bid to dismiss the case.

It ends more than seven years of fraught battles between Mr. Musk and the regulator, starting in September 2018 when the SEC charged him with securities fraud for tweeting he had “secured” funding to potentially take his electric car company Tesla private.

Mr. Musk settled that case by paying a $20 million civil fine, letting Tesla lawyers review some Twitter posts in advance, and giving up his role as Tesla’s chairman.

“Mr. Musk has now been cleared of all issues related to the late filing of forms in the Twitter acquisition, as we said from the outset he would be,” his lawyer Alex Spiro said in a statement.

The SEC declined to comment.

In its January 2025 lawsuit, the SEC said Mr. Musk’s 11-day delay in revealing his initial 5% Twitter stake in late March and early April 2022 let him buy more than $500 million of shares at artificially low prices, before he finally revealed a 9.2% stake.

The SEC had argued that Musk should pay a civil fine and repay the $150 million he allegedly saved at the expense of unsuspecting investors.

Mr. Musk called the delay inadvertent, and accused the SEC of violating his free speech rights by targeting him.

The SEC sued Musk six days before former U.S. President Joe Biden left the White House and was replaced by Donald Trump. Current SEC Chairman Paul Atkins has been refocusing the regulator’s enforcement priorities.

“It’s an embarrassing day for the SEC,” said Amanda Fischer, former chief of staff to Gary Gensler, who chaired the regulator during the Biden administration. She said the settlement “should cause the public to question whether the SEC is protecting White House insiders at the expense of ordinary investors.”

Mr. Musk led the Trump administration’s Department of Government Efficiency, which focused on cost-cutting, before leaving last May.

Robert Frenchman, a partner at the Dynamis law firm in New York, said the $1.5 million penalty was a “modest sum for the richest person on the planet” but could deter similar violations by others.

“That is a statement to the market that the rules apply to everyone, even to Elon Musk,” he said.