It seems at least possible that Musk may not get control of Twitter, since he approached the offer in a plainly unlawful manner. [For his part, Martin remains buoyantly hopeful to be back tweeting. His own FTC and SEC bans likely will prevent that, though.]
WSJ Confirmed: SEC Market Reg Investigating Musk’s Tardy 13D Disclosure — A Pattern Of Violations, Emerges…
As we expected, the SEC has opened another formal investigation into the pretty clear, on public, documented, on the record violations (again!) by Elon Musk, in secretly amassing a stake in Twitter, for over ten days, at much lower prices, before disclosing his intent, to the world.
He thus effectively fleeced all the shareholders he bought from — out of higher prevailing prices, for their shares (had they known he was angling to get the control premium), during the period from March 21 to April 2, when he finally disclosed his intent. This is specifically what the Williams Act rules are designed to outlaw. Stealing from unaware shareholders (when he already was overdue on his duty to disclose), when he himself knew what he was aiming to do — but had told no one.
This is exactly (in part) what saw Mike Milken get a ten year sentence (then commuted) — pattern, repeated violations of the tender offer, or Williams Act rules. And as we’ve detailed, Musk and his family likely traded for their own accounts, on inside information, in advance of when he tweeted his “poll” — on whether to sell stock in Tesla “for taxes” in November of 2021. That too is an open SEC investigation — copiously documented.
So — my punchline is that the otherwise good reporting at WSJ, includes opinions from people who forget that Musk is a serial offender in flouting SEC market integrity rules.
To be clear, that sort of conduct has earned Martin Shkreli a life time SEC banning order — and will earn Elizabeth Holmes a perhaps 15 year ban… and could yet put Musk in the “no public company” board or officer penalty box now for up to two years (my reasonable guess).
And that would end the Twitter deal, entirely. So the WSJ gets that much wrong here (and thus, it remains unlinked here — you may easily search for it, at Google).
It is possible he avoids a harsh penalty, but recall that a federal court judge last month ruled that he cannot alter the terms of his prior SEC settlement — made, to avoid criminal prosecution — for his false 2018 era “funding secured” tweet. He paid over $25 million there to avoid prosecution, and agreed never to again violate SEC rules.
But as the above amply demonstrates… his pattern violations continue.
नमस्ते
You literally can’t make stupid stuff like this up — unless, of course, one posits a nation where feckless multi-billionaires… can’t figure out how to keep it zipped up.
