{"id":70107,"date":"2026-05-13T23:06:09","date_gmt":"2026-05-13T23:06:09","guid":{"rendered":"https:\/\/www.europesays.com\/people\/70107\/"},"modified":"2026-05-13T23:06:09","modified_gmt":"2026-05-13T23:06:09","slug":"judge-says-elon-musks-1-5m-settlement-with-sec-over-twitter-disclosures-raises-red-flags","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/people\/70107\/","title":{"rendered":"Judge says Elon Musk’s $1.5M settlement with SEC over Twitter disclosures raises ‘red flags’"},"content":{"rendered":"

A federal judge on Wednesday cast doubt on the motives behind the Securities and Exchange Commission\u2019s\u00a0$1.5 million settlement\u00a0over\u00a0Elon\u00a0Musk\u2019s purchase of Twitter<\/a>, suggesting the deal may have been inked with the sole purpose of avoiding penalizing him personally.<\/p>\n

US District Judge Sparkle Sooknanan in Washington, DC, last week\u00a0had\u00a0summoned attorneys for both sides to appear before her to discuss the settlement, which the judge said had a string of \u201cirregularities\u201d that required in-depth explanation. She reiterated that she could not \u201crubber stamp\u201d their agreement<\/a>.<\/p>\n

Last year, the SEC accused\u00a0Musk\u00a0of waiting too long to disclose the buildup of his shares in Twitter in 2022. This month, the SEC removed\u00a0Musk\u00a0as a defendant and replaced him with a legal trust bearing his name. <\/p>\n

Last year, the SEC accused Elon Musk of waiting too long to disclose the buildup of his shares in Twitter in 2022. AP<\/p>\n

The settlement also dropped demands for the return of $150 million in allegedly ill-gotten gains, and reduced the total amount sought by 99%. The judge said these terms were \u201cred flags.\u201d<\/p>\n

\u201cGiven all the irregularities I have noted, I have concerns,\u201d the judge said.<\/p>\n

Sooknanan also noted that SEC lawyers at a prior hearing to discuss the case had appeared surprised when lawyers for\u00a0Musk\u00a0revealed that they had been in settlement talks with the agency.<\/p>\n

\u201cThat\u2019s a red flag to me,\u201d Sooknanan said.<\/p>\n

Representatives for\u00a0Musk\u00a0did not immediately respond to a request for comment. An SEC spokesperson declined to comment.<\/p>\n

Judge Sparkle Sooknanan reiterated that she could not \u201crubber stamp\u201d the $1.5 million settlement. District of Columbia | United States District Court<\/p>\n

The judge has said she must\u00a0consider several factors, including the settlement\u2019s\u00a0fairness to both sides, whether it is consistent with the public interest, and whether it is \u201ctainted by improper collusion or corruption.\u201d<\/p>\n

Wednesday\u2019s court hearing was the latest twist in a years-long dispute between the SEC and the Tesla\u00a0boss<\/a> over his $44 billion purchase of Twitter which closed in October 2022.<\/p>\n

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While the penalty the SEC imposed on\u00a0Musk\u2019s trust\u00a0was a fraction of what it originally sought,\u00a0it was\u00a0still the largest in SEC history for the type of violation he was accused of, a person familiar with the settlement said at the time.<\/p>\n

On Wednesday, Sooknanan asked lawyers for both sides to explain why they had structured the settlement to remove\u00a0Musk\u00a0personally as a defendant, suggesting it had been crafted \u201cfor the sole purpose of Mr.\u00a0Musk\u00a0being able to say that no relief was entered.\u201d<\/p>\n

Wednesday\u2019s court hearing was the latest twist in a years-long dispute between the SEC and the Tesla boss over his $44 billion purchase of Twitter which closed in October 2022. Christopher Sadowski<\/p>\n

Musk\u00a0is a former adviser to President Trump, and has claimed the lawsuit was politically motivated. He has also said the\u00a0delayed disclosure was inadvertent.<\/p>\n

The Trump administration has curtailed some types of corporate enforcement activity as Chair Paul Atkins refocuses the regulator\u2019s priorities.<\/p>\n

Former SEC enforcement chief Margaret Ryan, who left abruptly in March after just six months on the job, had clashed with agency leaders over the direction of its enforcement program,\u00a0Reuters reported.<\/p>\n","protected":false},"excerpt":{"rendered":"A federal judge on Wednesday cast doubt on the motives behind the Securities and Exchange Commission\u2019s\u00a0$1.5 million settlement\u00a0over\u00a0Elon\u00a0Musk\u2019s…\n","protected":false},"author":2,"featured_media":70108,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[122],"tags":[474,202,203,6194,34804,2110,3581],"class_list":{"0":"post-70107","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-elon-musk","8":"tag-business","9":"tag-elon-musk","10":"tag-musk","11":"tag-securities-and-exchange-commission","12":"tag-settlements","13":"tag-tech","14":"tag-x-formerly-twitter"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@people\/116569780009172419","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/posts\/70107","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/comments?post=70107"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/posts\/70107\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/media\/70108"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/media?parent=70107"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/categories?post=70107"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/tags?post=70107"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}