Tesla: share down; SEC charges Musk with fraud

(CercleFinance.com) - The Tesla share fell by over 10% in post-market electronic trading yesterday.


The US Securities and Exchange Commission (SEC), the US financial watchdog, has sued the group's iconic leader, Elon Musk, for his tweets described as false and misleading about Tesla's possible withdrawal from the stock market.

On 7 August, the SEC recalls that Elon Musk told his 22 million followers on Twitter that he was considering delisting the Tesla stock at 420 dollars per share, representing a significant premium over the then stock price, and that the deal's funding had already been completed. He later abandoned this project a few weeks later.

However, on this date, the SEC said that, "Musk had not discussed specific deal terms with any potential financing partners, and he allegedly knew that the potential transaction was uncertain and subject to numerous contingencies". The fact remains that on 7 August, the Tesla share rose sharply after this announcement, "and led to significant market disruption," the SEC stated.

In short, the case was brought before a federal court in New York with a charge of "fraud" violating US securities law. In addition to penalties, the SEC is also demanding that Elon Musk be removed from the board of directors and not run a listed company.



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