Elizabeth Warren Calls for SEC Investigation Into Tesla’s Twitter Connections
US Senator Elizabeth Warren has requested an investigation by the US Securities and Exchange Commission (SEC) into Elon Musk’s Tesla’s connection to Twitter. The Massachusetts Senator sent a letter to SEC chair Gary Gensler expressing concerns over potential conflicts of interest and other negative impacts on Tesla shareholders. Warren specifically mentioned the lack of independence from Musk on Tesla’s board and highlighted possible violations of securities laws and exchange rules. This is not the first time Warren has raised concerns about Tesla’s connection to Twitter, as she previously shared similar concerns with Tesla Chair Robyn Denholm in 2022.
Elon Musk acquired Twitter in a $44 billion buyout, which involved $13 billion in debt. He used billions of dollars from selling Tesla stock to raise the necessary capital for the acquisition. After taking over as CEO of Twitter, Musk utilized employees from Tesla and SpaceX to assist with the social media platform. Warren expressed concern about this practice, citing potential violations of labor laws and a lack of proper disclosure to shareholders regarding the relationship between Tesla and Twitter.
Despite the recent appointment of a new CEO for Twitter, Warren argues that Musk still maintains control as the company’s CTO and executive chairman. This ongoing involvement reinforces the conflict of interest concerns raised by the Senator. Warren’s letter to the SEC calls for a thorough investigation into Tesla’s board of directors and their connections to Twitter, with a particular focus on potential conflicts of interest, misappropriation of corporate assets, and negative impacts on Tesla shareholders.
The outcome of the SEC’s investigation, if initiated, could have significant implications for Tesla and its corporate governance practices. It remains to be seen how the SEC will respond to Warren’s request and whether any regulatory action will be taken as a result. This development adds to the growing scrutiny and challenges faced by Elon Musk and his various business ventures.