Instant access to a global megaphone and printing press has been proven to be dangerous to those who engage in impulsive behavior without considering the ramifications of their actions. Some individuals who have the mindset that they are speaking to “friends” and like-minded people are especially vulnerable to precipitous actions based on the emotions or present state of mind.
And, it appears that even innocent comments can have catastrophic results to one’s reputation, employment, bank account, and possibly freedom.
UPDATE: SEPTEMBER 29, 2018 — MUSK AND TESLA SETTLE WITH THE SEC FOR $40 MILLION AND JOB RESTRICTIONS
In one of those settlements where nobody admits or denies the allegations but pays a record fine, the Securities and Exchange Commission announced a settlement, subject to court approval.
Musk and Tesla have agreed to settle the charges against them without admitting or denying the SEC’s allegations. Among other relief, the settlements require that:
Musk will step down as Tesla’s Chairman and be replaced by an independent Chairman. Musk will be ineligible to be re-elected Chairman for three years;
Tesla will appoint a total of two new independent directors to its board;
Tesla will establish a new committee of independent directors and put in place additional controls and procedures to oversee Musk’s communications;
Musk and Tesla will each pay a separate $20 million penalty. The $40 million in penalties will be distributed to harmed investors under a court-approved process.
Original post continues…
Consider Elon Musk’s tweet suggesting that he was prepared to take Tesla private for $420 and that the funding was secured…
From UNITED STATES SECURITIES AND EXCHANGE COMMISSION, Plaintiff vs. ELON MUSK, Defendant. (Civil Action No. 1:18-cv-8865)…
“ At approximately 12:48 p.m. EDT on August 7, 2018, during trading hours, Musk tweeted to his over 22 million Twitter followers, “Am considering taking Tesla private at $420 Funding secured.” This statement was false and misleading. Over the next three hours, Musk made a series of additional materially false and misleading statements via Twitter including:
“My hope is *all* current investors remain with Tesla even if we’re private. Would create special purpose fund enabling anyone to stay with Tesla.”
“Shareholders could either to [sic] sell at 420 or hold shares & go private.”
“Investor support is confirmed. Only reason why this is not certain is that it’s contingent on a shareholder vote.”
“Musk knew or was reckless in not knowing that each of these statements was false and/or misleading because he did not have an adequate basis in fact for his assertions. When he made these statements, Musk knew that he had never discussed a going-private transaction at $420 per share with any potential funding source, had done nothing to investigate whether it would be possible for all current investors to remain with Tesla as a private company via a “special purpose fund,” and had not confirmed support of Tesla’s investors for a potential going private transaction. He also knew that he had not satisfied numerous additional contingencies, the resolution of which was highly uncertain, when he unequivocally declared, “Only reason why this is not certain is that it’s contingent on a shareholder vote.” Musk’s public statements and omissions created the misleading impression that taking Tesla private was subject only to Musk choosing to do so and a shareholder vote.”
“Investors reacted to Musk’s August 7 tweets. From the time of Musk’s first tweet that day until the close of trading on August 7, Tesla’s stock price increased by more than 6% on significantly increased volume and closed up 10.98% from the previous day.”
“Musk’s false and misleading public statements and omissions caused significant confusion and disruption in the market for Tesla’s stock and resulting harm to investors.”
Perhaps it would be best for individuals to write down their proposed media communications and wait a sufficient time before posting something that can grave damage to one’s personal and professional life.
Are you wondering, Am I Next?