In October we dropped in on Tesla and SpaceX CEO Elon Musk, covering his false statements and their consequences. In recent days, Musk again provided a clear example of what not to do when facing the harsh scrutiny of the Securities and Exchange Commission (SEC).
In an interview with CBS’ Lesley Stahl on 60 Minutes, Musk said, “I want to be clear: I do not respect the SEC.” (Source: “Elon Musk: ‘I do not respect the SEC'”, CNN Business). This jab at the regulatory agency comes just months after Musk was ordered to pay $20 million in settlement deals as a result of fraud charges that stemmed from his tweets about securing the financing to take Tesla private.
Whether Musk respects the SEC or not, he is abiding by the terms of the settlement agreements and his company has vowed to “firm up its oversight” of his social media use. In addition to the financial implications, Musk was forced to step down as chairman while remaining CEO.
It goes to show that you do not have to respect the SEC or even know the SEC. All that matters is whether your actions keep you on the right side of the SEC. If your actions, statements or associations result in you being investigated by the SEC, it is in your best interest to act respectfully and seek the help of an experienced attorney.
Ford O’Brien Landy LLP has helped many people and companies protect their interests and minimize the damage from SEC complaints. Our advice? There’s no harm in having a healthy respect for the SEC.