SEC Sues Tesla CEO Elon Musk For Securities Fraud

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Truman
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Elon Musk Does Deal With SEC and Steps Down as Tesla chairman, $40 million in fines

Elon Musk reached a deal over fraud charges that will see him step down as Tesla’s chairman of the board and pay a $20 million fine, US securities regulators said Saturday.

“The settlements, which are subject to court approval, will result in comprehensive corporate governance and other reforms at Tesla – including Musk’s removal as Chairman of the Tesla board – and the payment by Musk and Tesla of financial penalties” of $20 million each, the Securities and Exchange Commission said in a statement.

Musk remain CEO of Tesla and will be ineligible to serve as chairman of the board for a period of three years and will be replaced by an “independent chairman,” while two “independent directors” will also be appointed by Tesla, the SEC said.

Many would see this as Musk getting off easily as the SEC had sought to bar him from serving as an officer or board member of a publicly traded company.