Lisa O'Connor/AFP/Getty Images and AP Photo/Chris Carlson
- Elon Musk says he voted for Joe Biden in 2020. He seems increasingly interested in Donald Trump in 2024.
- One reason Musk might root for Trump: The SEC, led by a Biden appointee, is poking around his 2022 Twitter deal.
- It's purely theoretical for now, but The Wall Street Journal suggests that the SEC might push for severe penalties against Musk this time.
Elon Musk has made it clear that he doesn't like Joe Biden. He also seems increasingly interested in Donald Trump, though he won't come out and say he's formally backing him.
So here's another reason for him to move more firmly into the Trump camp: The US Securities and Exchange Commission, currently run by Biden appointee Gary Gensler, keeps dogging him.
The SEC has spent the last couple of years investigating Musk's purchase of Twitter — and the way he did, and didn't, disclose the fact that he was buying up Twitter shares prior to buying it in 2022.
Now The Wall Street Journal suggests that the agency is getting closer to making a formal case, and floats the notion that it could cost Musk his role as the CEO of Tesla, as well as chief technical officer at Twitter/X:
"The SEC hasn't filed any enforcement action so far against Musk over his Twitter trading. If the SEC makes a formal complaint against Musk for fraud, regulators are likely to again ask a court to bar him from serving as an officer or director of a public company, former officials said, exposing him to the possibility of removal from Tesla."
Context: The SEC has already gone after Musk in the past. In 2018, it sued him for making false statements about taking Tesla private and reached a settlement that amounted to a very, very light wrist slap on one of the world's richest men.
Musk has spent a lot of time since then complaining about the SEC publicly and in court, where he has unsuccessfully tried to have the settlement voided.
But this time, the Journal says, the SEC would want to do something more meaningful. And if that's the case, you could imagine Musk having that much more incentive to back Trump, and hope that Trump takes office in time to appoint a SEC head who would stop or reverse the agency's actions.
Caveats: The last time the SEC went after Musk, Trump was in the White House, and Trump appointee Jay Clayton was running the SEC. So a Trump victory doesn't guarantee a pass.
Just as important: The Journal piece includes lots of to-be-sures from legal experts about the difficulty of the SEC winning a case against Musk. Violating the spirit of SEC disclosure rules isn't the same as committing outright fraud. But Musk would certainly prefer not having to go to court to find out.