Fri. Apr 19th, 2019

The SEC revealed the punishment it wants Elon Musk to face if he violates the terms of their settlement in the future (TSLA)

The SEC revealed the punishment it wants Elon Musk to face if he violates the terms of their settlement in the future (TSLA)

  • The Securities and Exchange Commission (SEC) reportedly told a judge in New York City on Thursday that it wants Tesla CEO Elon Musk to face increasing fines if he violates the terms of their 2018 settlement in the future.
  • It is unclear whether a fine would be the extent of the punishment the agency believes Musk should receive for a February tweet that the SEC said did not comply with their settlement.
  • But it now appears unlikely that the SEC would want to bar Musk from serving as Tesla‘s CEO, a punishment the agency sought in its 2018 lawsuit over one of Musk’s tweets.
  • You can follow along for the latest in Thursday’s hearing here.

The Securities and Exchange Commission (SEC) told a judge in New York City on Thursday that it wants Tesla CEO Elon Musk to face increasing fines if he violates the terms of their 2018 settlement in the future, Bloomberg reported.

It is unclear from the Bloomberg report if a fine is the extent of the punishment the agency believes Musk should receive for a February tweet that the SEC said violated their settlement. But it now appears unlikely that the SEC would want to bar Musk from serving as Tesla’s CEO, a punishment the agency sought in its 2018 lawsuit over one of Musk’s tweets.

Judge Alison Nathan said on Thursday that she will direct Musk and the SEC to revise their settlement, according to Bloomberg.

Read more: LIVE: Elon Musk faces off with SEC in court

In February, the SEC asked a judge to hold Musk in contempt of the court that approved their 2018 settlement after Musk tweeted out a projection about vehicle production. The SEC said in a court filing that Musk had violated the terms of their settlement by not receiving approval from Tesla before publishing the tweet.

The settlement followed an August 2018 tweet from Musk saying he had obtained the funding necessary to take Tesla private at $420 per share. The SEC sued Musk over that tweet, saying that Musk was not as close to acquiring funding for the deal as he indicated. Their settlement required Musk to step down as the chairman of Tesla’s board of directors for three years, pay a $20 million fine, and receive approval for all future written communications that could be relevant to Tesla shareholders.

Got a Tesla tip? Contact this reporter at mmatousek@businessinsider.com.

SEE ALSO: ‘By whatever means necessary’: Tesla leaves some customers in the lurch as it rushes to deliver cars by the end of the quarter

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