SEC refutes Tesla CEO Elon Musk's complaint of 'unfounded investigations'

Feb. 19 (UPI) -- The Security and Exchanges Commission refuted Tesla CEO Elon Musk's accusations that his company was subjected to "endless, unfounded investigations" on Friday, claiming that the agency is acting diligently to handle a complex matter.

The SEC also pushed back against Musk's claim that the agency was dragging its feet in distributing a $40 million settlement to Tesla shareholders, which was paid by Musk and the company in 2018.

In a letter to Judge Alison Nathan filed in a Manhattan federal court, SEC official Steve Buchholz said the allocation plan took time to craft, "given the complexity of the distribution."

"That process is nearing completion and, barring any unforeseen circumstances, the Distributions staff expects to submit the proposed plan of distribution for the Court's approval by the end of March 2022," Buchholz wrote.

Buchholz's letter was sent on the heels of a complaint from Musk earlier this week that the SEC's "unrelenting" investigation into him and his company was meant to suppress his free speech rights.

He levied the accusation via his attorney, Alex Spiro, in a letter to Nathan on Thursday.

The SEC is "weaponizing the consent decree by using it to try to muzzle and harass Mr. Musk and Tesla," Spiro wrote.

"Worst of all, the SEC seems to be targeting Mr. Musk and Tesla for unrelenting investigation largely because Mr. Musk remains an outspoken critic of the government. The SEC's outsized efforts seem calculated to chill his exercise of First Amendment rights rather than to enforce generally applicable laws in an evenhanded fashion."

The 2018 settlement, also overseen by Nathan, was linked to a charge of securities fraud after Musk tweeted that he had secured funding to make Tesla a private company.

The terms of the settlement -- which did not include Musk admitting wrongdoing -- included both Musk and Tesla each paying a $20 million fine and Musk stepping down as company chairman for three years. The settlement also asked that Tesla staff supervise any statements Musk issues on behalf of the company, including on social media.

Since then, the SEC has repeatedly accused Musk of violating the terms of the settlement.

In 2019, the SEC asked the court to hold Musk in contempt over a tweet claiming Tesla would produce 500,000 cars. The agency also issued a new subpoena to Musk after he conducted a Twitter poll in November asking followers whether he should sell 10% of his Tesla shares.