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Abu Dhabi, UAEMonday 19 November 2018

Musk tweets that $20 million penalty for tweet was ‘worth it’

Last month the chief executive reached a settlement with the SEC after his claims about taking Tesla private

Last month, Mr Musk, who owns 20 per cent of Tesla stock worth $9 billion, reached a settlement with the SEC over fraud charges. AP
Last month, Mr Musk, who owns 20 per cent of Tesla stock worth $9 billion, reached a settlement with the SEC over fraud charges. AP

Tesla’s chief executive Elon Musk said the $20 million (Dh73.4m) fine he has to pay for announcing on Twitter that he had funding to take the electric vehicle maker private was “worth it”.

Mr Musk made the admission in a tweet before concluding his series of tweets by saying that he was "signing off for a few days".

Last month, Mr Musk, who owns 20 per cent of Tesla stock worth $9 billion, reached a settlement with the US Securities and Exchange Commission (SEC) under which he steps down as chairman of the electric car maker and pay a $20m fine to settle fraud charges over his claims about taking the company private. Tesla must also pay a $20m penalty.

The SEC settlement also requires Tesla to implement safeguards to oversee all of Mr Musk’s communications regarding the company in any format, including Twitter. The regulator said any written communications that contain information material to the company or its shareholders would need to be pre-approved.

Since the settlement, Mr Musk has hardly let a day go by without tweeting. On Friday, @elonmusk said, “on Twitter, likes are rare & criticism is brutal. So hardcore. It’s great.” A Twitter user replied, asking: “How about the one that cost you 20M, how was the ‘like’ ratio on that one?" Mr Musk said, “Worth it”.

How about that one that cost you 20M, how was the 'like' ratio on that one?

— James Patten (@yames51) October 27, 2018

Amid these tweets, Mr Musk announced the new Drive on Navigation feature allowing Tesla owners with Autopilot hardware and software to transition from one highway to another, automatic lane changes after driver confirmation and exiting capabilities — updates to Tesla's self-driving technology that were impossible to this point but news that was overshadowed by Mr Musk's outburst.

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Read more:

Fears for Musk's future sink Tesla shares

US regulators sue Elon Musk for fraud over Tesla tweets

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Market observers said the settlement is effectively a slap on the wrist for Mr Musk.

“Twenty million [dollars] is not going to change anything in the scope of Tesla and if the SEC thought he were guilty then they should have gone for a stronger fine with a bigger impact on Musk himself,” Nabil Al Rantisi, managing director of capital markets at Daman Investments, said to The National at the time of the decision.

The exchange came only a day after Tesla investors celebrated the company’s best-ever quarter. Still, Mr Musk appears determined to have the last word.