The SEC Is Investigating Elon And Kimbal Musk Over Possible Insider Trading

The SEC Is Investigating Elon And Kimbal Musk Over Possible Insider Trading

Tesla CEO Elon Musk’s tweets are once again getting him into trouble and this time his brother may have become mixed up in it, too, as the U.S. Securities and Exchange Commission is investigating a trade Kimbal Musk made in 2021 to see if the brothers violated insider trading rules.

The probe revolves around Elon Musk’s tweets in early November that asked if he should sell 10 percent of his stake in Tesla. Specifically, the regulator is interested in what circumstances led Kimbal to sell nearly $109 million in shares just a day before the infamous tweet, reports The Wall Street Journal.

Insider trading laws prohibit employees and board members from trading based on information about the company that is not public. Whether or not Kimbal knew that his brother would be sending out a tweet that would send the value of Tesla tumbling will likely be at the center of this case.

Read Also: Tesla Subpoenaed By SEC Over Elon Musk’s Infamous Tweet About Selling Shares

Just the latest development in the ongoing saga between the SEC and Elon Musk, we previously reported that a subpoena was sent to the automaker as part of an investigation into whether or not the Twitter poll violated Tesla’s agreement to provide oversight over its CEOs tweets.

The SEC is also separately investigating Tesla over a whistleblower complaint surrounding the company’s failure to notify the public about fire risks associated with its solar panels. In the complaint, a former employee claims he was fired in August 2020 as retaliation for raising safety concerns with Tesla.

More recently, another employee has brought a suit against Tesla over safety concerns at its Nevada battery plant.

“Tesla’s commitments to unrealistic production goals and frantic efforts to ramp up its production, often to make good on rash promises, overrode any commitment to employee safety,” Marc Cage, the complainant, said. He added that he was also harassed and denigrated on the basis of his race, becoming just the latest to accuse the automaker of fostering a racist work environment.

Elon Musk’s lawyer recently sent a letter to a U.S. district judge accusing the SEC of leaking information about his client. The lawyer, though, failed to state what information may have been leaked and to whom. In January, it was reported that Musk’s lawyer also sent a letter to the law firm Cooley LLP threatening to stop working with them if they did not fire an attorney who had previously worked with the SEC during the probe that led to $20 million fine against Musk.

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