SEC Hammers Musk, Market Hammers Tesla (NASDAQ:TSLA) Shares
Tesla (NASDAQ:TSLA) COB/CEO Elon Musk, 47 anni, could have settled with US regulators who have sued to remove him from the niche EV maker’s leadership. Instead, he says he will fight the securities fraud lawsuit against him in court Friday, as shares dove 13.9% deep Bear market territory.
Mr. Musk has been directly involved in almost every detail of its product development and technology strategy, and is credited as the driving force behind the loss-making company’s ability to raise capital.
The cost of insuring Tesla debt against default rose to its highest price ever Thursday and the plummeting share price attracted new Short sellers, who are betting against the stock.
Short sellers won $1.27-M Thursday alone in paper profits, and Tesla recently regained the title of most-shorted US stock in the market, according to S3 Partners.
The U.S. Securities and Exchange Commission (SEC) accused Musk on Thursday of tweeting false and misleading information in August about financing for his now-abandoned plan to take the company private, and said it was seeking to remove him as an officer or director.
Elon Musk, a billionaire entrepreneur, said he had done nothing wrong and the company’s board said it supported him.
Thursday, Mr. Musk walked away at the last minute from a settlement with the SEC that would have required him to give up Key leadership roles at the company for 2 years and pay a nominal fine, according to reports Friday.
But sources told HeffX-LTN that while Mr. Musk was ready to go to trial he could still settle with the commission. They did not discuss possible terms.
Mr. Musk has hired Stephen Best at Brown Rudnick, who successfully defended internet billionaire Mark Cuban in an insider trading case. He also hired former Assistant U.S. Attorney Chris Clark of Latham & Watkins to defend him in the case I learned Friday.
Tesla did not immediately respond to a request for comment.
The SEC declined to comment on the settlement reports.
It was once thought that Mr. Musk could successfully ride out the rough business Hell at the company, now that appears unlikely.
|NASDAQ:TSLA||264.77||28 September 2018||-42.75||270.26||278||260.55||33,546,506|
|HeffX-LTN Analysis for TSLA:||Overall||Short||Intermediate||Long|
|Bearish (-0.42)||Neutral (-0.17)||Very Bearish (-0.56)||Very Bearish (-0.51)|