'Elon Musk faces a ban from the board of Tesla and any other public company after Wall Street watchdogs charged him last night with making “false and misleading” statements about plans to take the electric car maker private.
The Securities Exchange Commission (SEC) accused Mr Musk of securities fraud over his infamous tweet that he had “funding secured” for a massive buyout of Tesla at $420 per share.
An initial tweet, sent on August 7, sparked a share frenzy with prices climbing as much as 11pc after the Tesla chief sent it for his 22m Twitter followers. By the close of play, Tesla's value had jumped by $6.3bn (£4.9bn) and Mr Musk was $1.2bn richer.
But the SEC claims that Musk knew that he had “never discussed a going-private transaction at $420 per share with any potential funding source” and that the tweets “caused significant confusion and disruption in the market for Tesla’s stock and resulting harm to investors”, according to documents filed in a court in Manhattan.
According to the SEC, Mr Musk had discussed a going-private deal with managers of Saudi Arabia's sovereign wealth fund and with his board of directors on July 31 but, "in truth and fact, Musk had not even discussed, much less confirmed, key deal terms, including price, with any potential funding sources."'
Read more: Elon Musk could be banned from Tesla board as watchdog accuses him of fraud over tweet
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