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Could Musk just get this over with and pay back whomever lost money on this? It might be worth it for him to keep his position. Edit: Ouch, I was only halfway

Could Musk just get this over with and pay back whomever lost money on this? It might be worth it for him to keep his position. Edit: Ouch, I was only halfway through the article when I wrote this, but just noticed it was mentioned after.

anoncoward111 8y ago
He reportedly tore up a settlement at the last moment. Fireworks!
- deleted 8y ago
  [deleted]
- vinceguidry 8y ago
  The settlement required him to step down as chairman for two years and let someone else run the company.
  - jyxent 8y ago
    Isn't the chairman position just part of the board of directors? I think he would have still been CEO with the agreement. If the SEC wins now, he won't be able to serve as CEO.
  - minimaxir 8y ago
    Having the SEC file against you is far, far worse.
  - dragontamer 8y ago
    No. Chairman of the board only runs the board of directors. The settlement would have allowed Musk to remain CEO (in charge of the company). The board of directors is in charge of the CEO... and Musk would have been allowed to remain a director (just not the leader / chairman of the directors). It was a super-lenient deal. I'm surprised Musk rejected it. True, the SEC was forcing Musk to take on 2-new board members, but Musk still has all of his old buddies on the board and would have likely remained in severe control of the company. Note that as the biggest shareholder, Musk also has the ability to vote on who comes and goes on the board-of-directors, and thus he'd be able to effectively choose the chair as well !! So Musk ultimately would have STILL remained in charge of the company by a severe margin. Musk is a big shareholder, is on the board of directors, AND is the CEO. He's the fox guarding the hen-house. Completely legal because companies can operate however they want... but SEC was trying to get the board of directors to at least look like they were somewhat independent. I mean, it probably would have been good for Tesla to get a more independent looking board...
romed 8y ago
How would a cash settlement meaningfully further the SEC's goal of protecting investors?
- toomuchtodo 8y ago
  No actions by the SEC meaningfully furthers their goal of protecting investors. They extract a fine, the party in question doesn't need to admit guilt, and the cycle continues. Occasionally, they send someone to jail to prove a point (Martin Shkreli), but out of their limited enforcement actions, it is rare. https://www.dandodiary.com/2018/05/articles/regulatory-enforcement-2/sec-public-company-enforcement-action-continue-steep-decline-first-half-fy-2018/ https://www.dandodiary.com/2018/05/articles/regulatory-enfor... (SEC Public Company Enforcement Action Continue Steep Decline in First Half FY 2018) > According to the report, the SEC filed 15 new enforcement actions against public companies and their subsidiaries in the first half of FY 2018, representing a 67 percent decline from the 45 enforcement actions the SEC filed in the first half of FY 2017. The number of enforcement actions filed in the first half of 2018 is significantly below the average of 29 enforcement actions filed per half year during the period FY 2010 through FY 2017, and below the median of 26 actions per half year filed during that same time period. The 15 enforcement actions filed against public companies and their subsidiaries in the first half of 2018 is the lowest half year filing total since the first half of FY 2013, when there were 12 filings. > The current trend toward significantly reduced numbers of enforcement actions against public companies and their subsidiaries began in the second half of 2017. In the last half of the 2017 fiscal year, the SEC filed only 17 enforcement actions against public companies and their subsidiaries, compared to 45 actions filed in the first half of FY 2017. Citigroup fraud cost investors hundred of millions of dollars. The SEC fined them $10 million. The SEC seems...less than effective in encouraging above board behavior by public companies. The fine is simply a cost of doing business. https://www.sec.gov/news/press-release/2018-155-0 https://www.sec.gov/news/press-release/2018-155-0 (Citigroup to Pay More Than $10 Million for Books and Records Violations and Inadequate Controls) > The Securities and Exchange Commission today announced that Citigroup has agreed to pay $10.5 million in penalties to settle two enforcement actions involving its books and records, internal accounting controls, and trader supervision. The charges stem from $81 million of losses due to trader mismarking and unauthorized proprietary trading and $475 million of losses due to fraudulently-induced loans made by a Mexican subsidiary.

anoncoward111 8y ago

He reportedly tore up a settlement at the last moment. Fireworks!

deleted 8y ago
[deleted]
vinceguidry 8y ago
The settlement required him to step down as chairman for two years and let someone else run the company.
- jyxent 8y ago
  Isn't the chairman position just part of the board of directors? I think he would have still been CEO with the agreement. If the SEC wins now, he won't be able to serve as CEO.
- minimaxir 8y ago
  Having the SEC file against you is far, far worse.
- dragontamer 8y ago
  No. Chairman of the board only runs the board of directors. The settlement would have allowed Musk to remain CEO (in charge of the company). The board of directors is in charge of the CEO... and Musk would have been allowed to remain a director (just not the leader / chairman of the directors). It was a super-lenient deal. I'm surprised Musk rejected it. True, the SEC was forcing Musk to take on 2-new board members, but Musk still has all of his old buddies on the board and would have likely remained in severe control of the company. Note that as the biggest shareholder, Musk also has the ability to vote on who comes and goes on the board-of-directors, and thus he'd be able to effectively choose the chair as well !! So Musk ultimately would have STILL remained in charge of the company by a severe margin. Musk is a big shareholder, is on the board of directors, AND is the CEO. He's the fox guarding the hen-house. Completely legal because companies can operate however they want... but SEC was trying to get the board of directors to at least look like they were somewhat independent. I mean, it probably would have been good for Tesla to get a more independent looking board...

romed 8y ago

How would a cash settlement meaningfully further the SEC's goal of protecting investors?

toomuchtodo 8y ago
No actions by the SEC meaningfully furthers their goal of protecting investors. They extract a fine, the party in question doesn't need to admit guilt, and the cycle continues. Occasionally, they send someone to jail to prove a point (Martin Shkreli), but out of their limited enforcement actions, it is rare. https://www.dandodiary.com/2018/05/articles/regulatory-enforcement-2/sec-public-company-enforcement-action-continue-steep-decline-first-half-fy-2018/ https://www.dandodiary.com/2018/05/articles/regulatory-enfor... (SEC Public Company Enforcement Action Continue Steep Decline in First Half FY 2018) > According to the report, the SEC filed 15 new enforcement actions against public companies and their subsidiaries in the first half of FY 2018, representing a 67 percent decline from the 45 enforcement actions the SEC filed in the first half of FY 2017. The number of enforcement actions filed in the first half of 2018 is significantly below the average of 29 enforcement actions filed per half year during the period FY 2010 through FY 2017, and below the median of 26 actions per half year filed during that same time period. The 15 enforcement actions filed against public companies and their subsidiaries in the first half of 2018 is the lowest half year filing total since the first half of FY 2013, when there were 12 filings. > The current trend toward significantly reduced numbers of enforcement actions against public companies and their subsidiaries began in the second half of 2017. In the last half of the 2017 fiscal year, the SEC filed only 17 enforcement actions against public companies and their subsidiaries, compared to 45 actions filed in the first half of FY 2017. Citigroup fraud cost investors hundred of millions of dollars. The SEC fined them $10 million. The SEC seems...less than effective in encouraging above board behavior by public companies. The fine is simply a cost of doing business. https://www.sec.gov/news/press-release/2018-155-0 https://www.sec.gov/news/press-release/2018-155-0 (Citigroup to Pay More Than $10 Million for Books and Records Violations and Inadequate Controls) > The Securities and Exchange Commission today announced that Citigroup has agreed to pay $10.5 million in penalties to settle two enforcement actions involving its books and records, internal accounting controls, and trader supervision. The charges stem from $81 million of losses due to trader mismarking and unauthorized proprietary trading and $475 million of losses due to fraudulently-induced loans made by a Mexican subsidiary.