Elon Musk Calls for SEC Overhaul Amid Legal Battle

Elon Musk called for a “comprehensive overhaul” of the U.S. Securities and Exchange Commission hours after the regulator sued him for allegedly failing to testify in its investigation of his $42 billion Twitter (now X) acquisition in October.

The SEC is investigating whether Musk’s purchase triggered securities laws, and a filing made on October 5 in California District Court seeks to compel Musk to comply with an earlier SEC subpoena.

Musk suggested in an X post on the same day that the SEC and the U.S. Department of Justice should instead be investigated.

“A comprehensive overhaul of these agencies is sorely needed, along with a commission to take punitive action against those individuals who have abused their regulatory power for personal and political gain.”

Musk added, in response to a post detailing the numerous actions the U.S. government has taken against Elon Musk-led companies, “I can’t wait for this to happen.”

When asked by an X user if such an investigation would ever occur, Musk responded, “I estimate the likelihood to be 100%.”

The filing states that the SEC issued a subpoena to Musk in May 2023 and required him to testify at the regulator’s San Francisco office on September 15, which Musk initially consented to.

Two days prior, Musk “suddenly” notified the SEC that he would not appear and made several “frivolous objections,” according to the SEC.

The regulator claimed it attempted to negotiate an alternative time and location for Musk’s testimony in “good faith” but was met with a “broad refusal” from Musk.

In addition, the SEC asserted that Musk’s objections lacked legal validity.

The SEC’s regulatory approach to the cryptocurrency industry is a heated topic of discussion on X, one of the most prominent social media platforms for the cryptocurrency community.

In recent months, Musk has sought to incorporate cryptocurrency payments on X, having obtained a currency transmitter license from Rhode Island’s governing body in late August.

Musk has previously attacked the SEC, making his position on the regulator plain in a 60 Minutes interview in December 2018:

“I have no regard for the SEC. I have no regard for them.”