SEC and DOJ reportedly launching investigation into Elon Musk

Not long after Elon Musk made an offer to buy Twitter, the Securities and Exchange Commission and the Department of Justice are reportedly launching a joint investigation into Musk.

The news was first reported by Fox Business’s Charles Gasparino.  Gasparino elaborated during Neil Cavuto’s “Your World.”

“[Musk] is under investigation,” he explained. “A joint investigation, by the DOJ and the SEC over lots of stuff, including some of the stuff involving how he went about accumulating his shares on Twitter and how he disclosed that, whether he properly disclosed his intentions—which was obviously a full takeover—also some of this stuff with Tesla, you know, disclosures there…”

“It’s a joint investigation, it’s serious, I’m not saying a lot of these investigations turn up nothing. They’ve been looking at him for a long time, so you would think by now they’d have something, but they’re clearly—I spoke with a source, very close to it, who says it’s a serious investigation by the DOJ and the SEC into all those matters,” Gasparino added.

Reuters wrote the following; “Former securities officials and professors said Tesla Inc’s chief executive may have missed a key disclosure deadline and filed the wrong paperwork when he bought 9% of Twitter Inc, a platform regularly used by the outspoken billionaire. Securities and Exchange Commission regulators could use any shortfall to try to punish Musk more for other lapses, some believe.”

Reuters goes on to note that U.S. securities law requires disclosure within 10 days of acquiring more than 5% of a company, and that Musk did not meet that deadline.

Adam C. Pritchard, a law professor at University of Michigan Law School, told the outlet: “This is not really a gray area. He acquired it and didn’t file within 10 days. It’s a violation. And so this is a slam-dunk case from the SEC perspective.”