Mark Cuban reportedly urged Tesla's Musk to settle SEC fraud charges

Muriel Colon
October 7, 2018

West made the comments Tuesday as he checked out student projects at the Detroit College for Creative Studies, a private art school.

Last week, Musk settled with the Securities and Exchange Commission, after federal regulators accused him of duping investors after tweeting that he had "funding secured" to take the electric carmaker private.

Tesla and Mr. Musk agreed to pay $20-M each to the regulator under the settlement, and Mr. Musk to step down as the company's Chairman but remain CEO as part of the deal.

The deal also calls for Tesla to pay a $20 million fine and vet any social media posts by Musk that could have a material impact on the company's finances.

Musk derided the SEC as the "Shortseller Enrichment Commission" before snidely praising it for "doing incredible work".

The settlement also required Tesla's board to implement procedures for reviewing Musk's communications with investors, which include tweets.

Tesla Chief Executive Office Elon Musk speaks at his company's factory in Fremont, California, U.S., June 22, 2012.

Nathan "may want to know why Tesla is paying a fine because the CEO doesn't know when to shut up", said Adam Pritchard, a University of MI law professor and former SEC lawyer.

Judge Alison Nathan said it was a regular practice at the Southern District of New York Court to ask for a joint statement.

The SEC told CNN Business that it has not changed its name and declined further comment on the tweet.

Greenlight said it also sold its last Apple Inc shares in August at $228 per share, eight years after buying the iPhone maker at less than one-sixth that price, on growing fear of "Chinese retaliation against America's trade policies".

Greenlight is having a hard year, with its main fund down 25.7 percent through September, but said its Tesla short position was its second biggest victor in the third quarter.

Shares of the company, down around 14 percent this year but still up nearly 30 percent since the start of 2017, were last down 6.9 percent at $262.63.

Within the hour of the original tweet, Musk responded to a comment on his Tweet professing to apologize for the "typo" in the original tweet (as he seemed to leave out the word "say").

The 2nd Circuit has jurisdiction over Nathan's court, and lawyers said Musk's settlement would likely win approval, though orders such as Nathan's are not too common. The tweet surprised investors, analysts and Tesla's board of directors.

"Someone has to get a hold of his Twitter account and stop him", Henning said.

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