Elon Musk rejects SEC settlement over X acquisition

Elon Musk has disclosed that the U.S. Securities and Exchange Commission (SEC) has issued a settlement demand in its ongoing investigation into his 2022 acquisition of X (formerly Twitter).

The SEC is probing whether Musk violated securities laws by failing to disclose his stock purchases on the social media platform within the required 10-day timeframe.

Musk’s attorney, Alex Spiro, made the revelation in a letter shared on social media, detailing the SEC’s demand that Musk accept a fine or face formal charges.

The letter accused the SEC of escalating regulatory pressure at the direction of senior officials and described the agency’s actions as politically motivated. Musk has refused to comply with the demand, setting the stage for yet another legal showdown between the billionaire and the federal regulator.

This latest clash underscores Musk’s long-running feud with the SEC, which began with his high-profile 2018 dispute over a controversial tweet claiming he had “funding secured” to take Tesla private.

That incident resulted in a settlement requiring Musk and Tesla to pay $20 million each, along with restrictions on Musk’s communications related to Tesla operations. Despite these measures, tensions between Musk and the regulator have only intensified in recent years.

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The current investigation stems from Musk’s purchase of a 9% stake in Twitter in April 2022, ahead of his eventual $44 billion acquisition of the company.

The SEC alleges Musk violated disclosure laws by failing to report the purchase promptly, which could have impacted Twitter’s stock price and market transparency. Musk later rebranded the company as “X” after finalizing the deal.

In his letter, Spiro also revealed that the SEC has reopened an investigation into Musk’s brain-machine interface company, Neuralink, and that Spiro himself had been subpoenaed to testify—a request he has refused. The letter accused the SEC of harassment and demanded transparency over whether the regulatory push was influenced by political pressure.

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“We demand to know who directed these actions – whether it was you or the White House,” Spiro wrote, asserting that Musk and his associates would not be intimidated.

The ongoing feud also intersects with broader disputes between Musk and SEC Chairman Gary Gensler. Gensler has taken an aggressive stance against cryptocurrencies, labeling the market as “ripe with fraud, scams, and abuses.” Musk, a prominent advocate for digital assets, has often pushed back against regulatory scrutiny in this area.

However, the regulatory environment may shift as President-elect Donald Trump has nominated Paul Adkins, a pro-crypto advocate, to replace Gensler at the SEC.

If confirmed, Adkins’ leadership could mark a significant change in the agency’s approach to both Musk’s businesses and the broader cryptocurrency market.

As Musk continues to resist the SEC’s latest demands, the outcome of this battle could have far-reaching implications for regulatory oversight, corporate disclosure rules, and Musk’s sprawling business empire.