- Elon Musk posted a picture of an irate letter his lawyer allegedly sent to SEC chair Gary Gensler that detailed investigations into two of his companies.
The Securities and Exchange Commission allegedly sent Elon Musk a “settlement demand” on Wednesday over an investigation into whether he may have violated securities laws and regulations, according to an X post from Musk.
The post features a screenshot of a letter Musk’s lawyer Alex Spiro sent to soon-to-depart SEC chair Gary Gensler. In the letter Spiro, partner at the law firm Quinn Emanuel, wrote the SEC sent Musk an offer that would see Musk pay a fine instead of facing “charges on numerous counts,” according to the letter. The SEC told Musk he had 48 hours to accept its proposal, according to Spiro.
The investigation stretches back to 2022 when Musk allegedly failed to properly disclose the sizable stake he was building in Twitter in the lead up to his purchase of the social media platform he has since renamed X. At the time, Twitter was a public company. Any investor who builds a beneficial ownership stake larger than 5% in a publicly traded company and seeks to influence or control it must issue a 13D filing within 10 days of crossing that threshold. The SEC is investigating whether Musk waited too long to disclose that he had accumulated his position in Twitter. Musk later disclosed that he had a 9% stake in the company, before then offering to buy it in its entirety. In July of this year, Musk said the delay was a “mistake” and that he had misunderstood the requirements.
Spiro did not respond to a request for comment regarding the letter. A spokesperson for the SEC said it does not comment on the existence of investigations. ”It is the policy of the SEC to conduct investigations on a confidential basis to preserve the integrity of its investigative process,” the spokesperson said.
Musk’s X post featured the caption, “Oh Gary, how could you do this to me?”
Spiro also hinted that parts of the investigation could have been politically motivated. SEC investigators told Musk the settlement and the two-day deadline were “a result of a directive from their superiors,” Spiro wrote in the letter.
Gensler is a Democratically-appointed chair, having been nominated to the role by President Joe Biden in 2021, while Musk is a key supporter of President-elect Donald Trump. Spiro wondered whether Musk and Biden’s political differences may have played a role in the SEC investigation.
“We demand to know who directed these actions—whether it was you or the White House,” Spiro said in the letter.
Gensler’s remaining time at the SEC is limited. In November, he announced he would step down in January when Trump took office.
Spiro also detailed an additional investigation into another of Musk’s companies. He claimed the SEC had reopened an investigation into Neuralink, which develops computer chips that can be implanted in the brain, according to Spiro. In November 2023, a series of lawmakers pushed the SEC to investigate Neuralink over claims it had misled investors about the safety of its procedures. It is unclear whether this was the specific case Spiro referred to in his letter.
Musk’s run-ins with the SEC date back to 2018 when he tweeted he was taking Tesla private. The company never went private. The SEC fined Musk $20 million and said his tweets about Tesla would need to be vetted by a company lawyer. Musk sought to have the latter provision overturned but lost that court case, which went all the way to the Supreme Court.
The most recent settlement offer was the latest example of “more than six years of harassment,” Spiro wrote. In the letter Spiro also said that he himself had been subpoenaed for testimony as part of the investigation. “I categorically refused,” he wrote.
“These tactics and misguided scheme will not intimidate us,” he wrote. “We reserve all rights.”
