Federal judge rejects immediate approval of Elon Musk’s $1.5m SEC settlement

A federal judge in Washington, D.C. has declined to immediately approve a $1.5 million settlement between Elon Musk and the U.S. Securities and Exchange Commission (SEC). Judge Sparkle Sooknanan stated that she requires more comprehensive information regarding how the accord was reached before she can determine if the agreement is fair to both parties and consistent with the broader public interest. The settlement was intended to resolve a lawsuit alleging that Musk violated federal securities laws by waiting 11 days too long to disclose that he had acquired a 5% stake in Twitter in early 2022. The regulator accused Musk of saving approximately $150 million by continuing to purchase shares at lower prices before his 9.2% stake was eventually made public in April 2022. Judge Sooknanan emphasized that her role involves ensuring the settlement is not "tainted by improper collusion or corruption." The proposed settlement notably did not require Musk to admit to any wrongdoing or to disgorge the $150 million he allegedly saved through the delayed disclosure. Judge Sooknanan has ordered both the SEC and Musk’s legal team to appear in court on May 13 to propose a timeline for filing briefs that justify the fairness and transparency of the agreement.

(Source：Investing India)