Judge Approves $1.5 Million SEC Settlement with Elon Musk Over Twitter Stake Disclosure

A federal judge in Washington, D.C., has approved a $1.5 million settlement between the Securities and Exchange Commission (SEC) and Elon Musk. The agreement resolves an SEC lawsuit concerning Musk's 2022 purchase of shares in Twitter, now known as X. U.S. District Judge Sparkle Sooknanan approved the accord on Wednesday but voiced "significant misgivings."

The SEC lawsuit, filed on January 14, 2025, accused Musk of failing to timely disclose that he had acquired a stake of over 5% in Twitter in April 2022. The agency alleged that the delay allowed Musk to purchase additional shares at a lower price, saving him an estimated $150 million before his stake became public knowledge. Musk acquired the social media company for $44 billion six months later.

In her decision, Judge Sooknanan stated that her role was limited to evaluating whether the settlement met basic standards of fairness and reasonableness. While expressing her concerns, she noted that it should be left to the public to decide through the voting process whether the SEC had held Musk sufficiently accountable for his actions.

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Musk has previously asserted that the lawsuit was politically motivated, as it was filed shortly before the end of the Biden administration. He has also maintained that the delayed disclosure was unintentional. Before approving the settlement, the judge had requested both parties to provide briefs supporting the agreement's fairness and consistency with the public interest.