Securities and Exchange Commission settles with Elon Musk over late disclosure of X shares

Several court documents revealed Monday that the U.S. Securities and Exchange Commission (SEC) has finalized a settlement with Elon Musk over the late disclosure of his stock stake in social network X, in which he will pay a civil penalty of $1.5 million to settle the case. The settlement ends a long-running legal dispute between Musk and the agency, which began when the agency began scrutinizing his stock purchases in 2022, and regulators alleged that the tycoon failed to timely report when his stake exceeded the 5% threshold.

While Musk finally disclosed his position in April of that year, by which time his stake had already exceeded 9%, the conflict escalated when the also SpaceX owner refused to participate in additional testimony, prompting regulators to ask a judge to compel him to testify. As the SEC has alleged on several occasions, this delay may have been planned, as it allowed Musk to snap up shares at lower prices, saving more than $150 million.

The resolution comes at a delicate time for Musk, taking into account that he is also currently facing a separate tough legal battle in California with OpenAI director Sam Altman, whom many media outlets have been showing as the SpaceX owner's great rival and competitor in the technology industry. Over the past few months, Musk, who is a co-founder of OpenAI, has publicly accused Altman and fellow co-founder Greg Brockman of deviating from the organization's original mission.

The tycoon, who acquired the platform then called Twitter for $44 billion in 2022, thus closes the lawsuit filed by the regulator of an administration of which he was initially part but from which he eventually ended up separating after numerous disagreements with President Donald Trump.