WASHINGTON — Federal regulators are investigating Elon Musk’s late disclosure last month of his sizable stake in Twitter Inc.
according to people familiar with the matter, a lag that allowed him to buy more stock without alerting other shareholders to his ownership.
The Securities and Exchange Commission is probing Musk’s tardy submission of a public form that investors must file when they buy more than 5% of a company’s shares, the people said. The disclosure functions as an early sign to shareholders and companies that a significant investor could seek to control or influence a company.
The Tesla Inc.
chief executive made his filing on April 4, at least 10 days after his stake surpassed the trigger point for disclosure. Musk hasn’t publicly explained why he didn’t file in a timely manner.
The SEC investigation hasn’t been previously reported. An SEC spokesman declined to comment. An attorney for Musk didn’t respond to a message Wednesday seeking comment.
Musk likely saved more than $143 million by not reporting that his trades had crossed the 5% threshold, said Daniel Taylor, a University of Pennsylvania accounting professor, since the share price could have been higher had the market known of the billionaire’s growing stake.
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