According to Wall Street Journal, SEC (Securities and Exchange Commission) is searching whether Elon Musk and his brother Kimbal Musk sold his Tesla shares but potentially violated insider trading.
This all happened only because of Elon Musk’s Twitter poll where he wants other people’s opinion he should sell 10% percent of his company stake. Well, what do you think most people suggest to Elon Musk what to do?
The Twitter poll get millions of answers from which 57.9 percent of people said “yes” and 42.1 percent voted “no” and as result, Tesla shares fell due to the result of the poll.
Why Kimbal Musk Matters in this Insider Trading?
Tesla CEO Elon Musk’s brother Kimbal Musk who sits on Tesla boards director sold his 88,500 shares before Elon Musk Twitter Poll will live.
Insider trading laws prohibit employees and board members from trading based on information that has not been made public.
Employees and board members can avoid insider trading charges by trading at predetermined times as part of a program known as 10b5-1. Kimbal Musk has used this program in the past, issuing 40 disclosures since 2011 that he has traded shares under the 10b5-1 program, according to the Journal. But a November 5th disclosure regarding the shares he sold before his brother’s Twitter poll did not indicate he was using that program.
Elon Musk has some previous issues with the SEC judge due to sending out an inaccurate tweet, arguing it violated terms and agreement.
Elon Musk said he is full preparing against SEC and he also said ” I didn’t start a fight, but I will finish it.”
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