US SEC approaches court to force Musk to testify in Twitter acquisition probe

The United States Securities and Exchange Commission (SEC) has filed a court application to compel Elon Musk to testify in an ongoing investigation relating to his acquisition of X — formerly known as Twitter — in October 2022.

SEC said it is investigating potential violations of various provisions of the US federal securities laws involving the $44 billion deal that saw the defunct Twitter transition from a publicly owned social media company to a private firm.

In a statement on Thursday, the SEC said Musk’s statements and its filings relating to Twitter are also being probed – but no individual or entity has been pegged as a violator of the federal securities laws. 

The US regulator said Musk’s testimony will provide additional information that is not available to it, but relevant to its investigation.

SEC, MUSK HEAD TO COURT OVER REFUSAL TO TESTIFY

SEC complained that the effort to get Musk to speak regarding the investigation has proved abortive, despite the billionaire’s assurances of making himself available in September 2023.

“According to the filing, Musk failed to appear for testimony as required by the investigative subpoena served by the SEC, despite: (1) agreeing to appear for testimony on a mutually agreed upon date in September 2023,” SEC said in the statement.

The regulator said Musk was served the subpoena in May 2023, requiring his appearance for testimony in the SEC’s San Francisco regional office “on that mutually agreed upon date”.

SEC said Musk did not raise any objection to the subpoena until two days before his scheduled testimony date in September 2023.

Commenting on the reason for not appearing before the regulator, the SEC said the businessman raised “several spurious objections”. 

“If a person or entity refuses to comply with a subpoena issued by SEC enforcement staff pursuant to a formal order of investigation, the Commission may file a subpoena enforcement action in federal district court seeking an order compelling compliance,” the statement further reads.

According to statement, Musk’s refusal to honour the subpoena forced the SEC to file an application at the U.S. district court for the Northern District of California, to obtain an order directing Musk to comply with their investigative subpoena.