The United States Securities and Exchange Commission (SEC) and Federal Trade Commission (FTC) are investigating Elon Musk over his stake in Twitter.
The SEC is looking into the billionaire’s delay in filing documents that must be submitted when an investor buys more than 5% of a company’s stock.
And the FTC is examining whether Musk violated a law by failing to report large transactions, which must be done to antitrust-enforcement agencies.
The law requires an investor to wait 30 days before buying more shares of the company, with the regulator using that time to determine if the purchase could hurt competition.
Did Elon Musk act in accordance with law?
The public form that the SEC is looking at is significant because of disclosure-related reasons and informs stakeholders and the public that the investor in question could be seeking to control or influence a company, reported the Wall Street Journal.
Musk’s decision to buy Twitter – to protect free speech, according to him – sent shockwaves through the world. Some praised the move, saying it would bring some much-needed change to Twitter, while others are concerned. One of the actions that Musk has said he would take is to remove bots from Twitter.
Musk frequently uses Twitter to air his opinions on cryptocurrencies, often resulting in wild price swings for the assets. Dogecoin has been one of the biggest beneficiaries. Consequently, some crypto enthusiasts are excited at the prospects of a Musk-led Twitter.
This is not the first time that the SEC has looked at the actions of Elon Musk. He was ordered to abide by a settlement over tweets in 2018. And Musk has made his disdain for the SEC well known in the past.
The acquisition is still to go through, and regulators’ actions may yet put a stop to it, though this appears unlikely.
In the meantime, the SEC will continue to look at what it can, which will provide some more drama in what is proving to be an already eventful year.