Democrat President Joe Biden’s administration has launched an investigation into Elon Musk over the dealings surrounding his purchase of Twitter.
Biden’s Securities and Exchange Commission (SEC) is investigating Musk after he secured a deal to buy the social media company for $44 billion.
According to a new report in the Wall Street Journal, the SEC is probing the paperwork filed by Musk while he was putting his deal into place.
“The Securities and Exchange Commission is probing Mr. Musk’s tardy submission of a public form that investors must file when they buy more than 5% of a company’s shares,” The WSJ reports.
“The disclosure functions as an early sign to shareholders and companies that a significant investor could seek to control or influence a company.”
The report said that Musk’s April 4 disclosure filing was at least 10 days late, a move that is believed to have saved him more than $140 million because share prices could have been higher if the public knew about his ownership of 5% of the company.
“The case is easy. It’s straightforward,” Daniel Taylor, a University of Pennsylvania accounting professor, said.
“But whether they’re going to pick that battle with Elon is another question.”
The report noted that a lawsuit against Musk from the SEC would likely not stop him from taking over Twitter since the company’s board of directors unanimously approved to be acquired by Musk and the SEC may lack the power to do so.
Musk’s purchase of Twitter is also reportedly being reviewed by the Federal Trade Commission (FTC).
The news has emerged almost immediately after Musk said this week that he will reverse Twitter’s permanent ban on President Donald Trump if and when the sale is finalized.
“I think that was a mistake because it alienated a large part of the county, and did not ultimately result in Donald Trump not having a voice,” Musk said, adding that the decision was “morally bad.”
“That doesn’t mean that someone gets to say whatever they want to say,” Musk said.
“If they say something that is illegal or destructive to the world, then there should be perhaps a timeout, temporary suspension, or that particular tweet should be made invisible or have very little traction.”
“I would reverse the permanent ban,” Musk added.
Musk indicated that action could be taken against an account if there were tweets that violated platform policy, which he said, “should be either deleted or made invisible, and a suspension—a temporary suspension—is appropriate, but not a permanent ban.”
Musk said that permanent bans “should be extremely rare and really reserved for accounts that are bots, or scam, spam accounts.”