The U.S. Security and Exchanges Commission (SEC) responded on Friday, February 18, to Tesla CEO Elon Musk's allegations that he and his company were subjected to endless and unfounded investigations by the agency, saying that it is acting diligently to resolve a complex matter.
The SEC also refuted Musk's assertion that the federal agency was dragging its feet in distributing the $40 million settlement to the shareholders of Tesla, which was paid by the company and its chief executive back in 2018.
SEC official Steve Buchholz wrote to Judge Alison Nathan in a letter filed in a Manhattan federal court to explain the agency's side, saying that the allocation plan for the $40 million settlement is taking time to craft given the complexity of its distribution.
SEC to submit distribution plan by next month
As per CNBC, Buchholz added that it is only a matter of time before the SEC distributes the settlement to Tesla shareholders, saying that process is nearing completion and that the "Distributions staff expects to submit the proposed plan of distribution for the Court's approval by the end of March 2022."
Buchholz sent a reply on behalf of the SEC after Musk filed a complaint earlier this week, insinuating that the agency's "unrelenting" investigation into him and Tesla was meant to stifle his right to free speech. Musk levied the stunning accusation via his attorney Alex Spiro in a letter filed to Nathan on Thursday, February 17.
Spiro wrote to the judge, who handled the 2018 settlement between the two parties that the agency is "weaponizing the consent decree by using it to try to muzzle and harass Mr. Musk and Tesla."
Spiro added that the SEC seems to be targeting Musk and Tesla because he continues to be an outspoken critic of the government, saying the agency's efforts seem calculated to chill the chief executive's exercise of his First Amendment rights.
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Tesla's war with SEC going on for years now
The war between the SEC and Tesla all started in September 2018 when the agency charged the celebrity CEO with making "false and misleading" statements to the automaker's investors after he posted on Twitter that he had secured private funding for a buyout of the company at $420 a share. Tesla's stock went into a period of unusual volatility following Musk's tweets but the deal that he tweeted never materialized.
Tesla and Musk eventually settled with the SEC, each paying a $20 million fine and the billionaire owner relinquishing his position as company chairman for three years. The settlement, which did not include Musk admitting any wrongdoing in the Twitter fiasco, also required Tesla staff to supervise all of Musk's statements that he will issue on behalf of the company, including on social media platforms.
That has not stopped Musk from posting on Twitter about Tesla, with the SEC repeatedly accusing Musk of violating the terms of the settlement.
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