Can the SEC stand up to the richest man on the planet?


Publish Date:
June 4, 2022
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A lot of Musk’s recent behavior has raised eyebrows. Former SEC Commissioner Joseph Grundfest says that it seems pretty clear-cut Musk broke the law with that late filing. When someone amasses more than a 5% stake in a public company, the person has 10 days to tell the SEC, but Musk took his time.

“As a practical matter, it seems to me that this is about as close to a slam-dunk case as you’re going to find,” says Grundfest, who is now a professor at Stanford Law School. “The junior-most lawyer at the SEC should be able to write up a very powerful complaint.”

But Grundfest isn’t convinced that charging Musk with a disclosure violation would do much. That offense usually carries a fine of about $100,000.

“To a guy like Elon Musk, that’s pocket lint,” says Grundfest. “That’s chump change. It’s bupkis. You take it out of petty cash.”

Musk, who is the world’s wealthiest person, has an estimated net worth of $227 billion, according to the Bloomberg Billionaires Index.

“It’s really not going to make a difference,” Grundfest adds. “It isn’t going to change behavior. He’ll chuckle.”

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