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Musk’s SEC fine cost even less than a slap on the wrist

Elon Musk, founder, CEO and lead designer at SpaceX and co-founder of Tesla, arrives at the SpaceX Hyperloop Pod Competition II in Hawthorne, California.
REUTERS/Mike Blake
Fines are fine.
  • Amanda Shendruk
By Amanda Shendruk

Visual journalist

Published This article is more than 2 years old.

Less than two months ago an unanticipated Tweet emerged from Elon Musk announcing that he was “considering taking Tesla private at $420. Funding secured.” It was an auspicious claim from the company’s chairman and CEO. Now, that Tweet has cost him $40 million.

On Sept. 27, 2018, The Securities and Exchange Commission (SEC) accused Musk of making “false and misleading” statements. A settlement soon followed, requiring Musk to leave his role as Tesla’s chairman. Musk and the company agreed to pay a $20 million fine each.

But relatively speaking, Musk got off with the equivalent of a parking ticket.

Following the Tweet, Tesla’s stock closed at $379.57, the 2018 high. The $20 million fine was less than 0.1% of Musk’s net worth. After the deal was announced shares of Tesla returned to pre-“420” levels.

With consequences like these, it’s no surprise Musk’s first post-fine Tweet showed no remorse.

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