NEW YORK, Feb 25 — The US Securities and Exchange Commission is investigating whether recent stock sales by Tesla Inc Chief Executive Elon Musk and his brother Kimbal Musk “violated insider trading rules”, the Wall Street Journal reported on Thursday, citing people familiar with the matter.
According to the report, the investigation began last year after Kimbal sold shares of the electric carmaker valued at US$108 million (RM453.7 million), a day before Musk polled Twitter users asking whether he should offload 10 per cent of his stake in Tesla.
The SEC issued a subpoena on Nov. 16, ten days after Musk’s poll, seeking information related to some financial data.
The potential probe would escalate Musk’s battle with regulators as they scrutinize his social media posts and Tesla’s treatment of workers, including accusations of discrimination.
Last week, Tesla and Musk accused the SEC of harassing them with an “endless” and “unrelenting” investigation to punish Musk for being an outspoken critic of the government.Read full story
Elon Musk’s share sales in November were automatically executed according to a trading plan he had created on Sept. 14, showed a filing disclosing share sales, including stock options that were supposed to expire in 2022.
The SEC sued Musk in August 2018 after he tweeted he had “funding secured” to potentially take his electric car company private at US$420 per share. In reality, a buyout was not close.
Tesla’s shares were up about 1 per cent in late-afternoon trading, paring losses amid a broader stock market rout.
The stock has fallen about 33 per cent since Musk began selling billions of dollars worth of shares on Nov. 8, few days after the poll where 58 per cent of voters asked him to sell. Read full story
Tesla and Kimbal Musk did not immediately respond to Reuters’ requests for comment. A spokesperson for the SEC declined to comment. — Reuters