Elon Musk agreed to pay $1.5 million to settle Securities and Exchange Commission allegations that he cheated Twitter shareholders in 2022 by failing to properly disclose his growing stake in the social media company.
An Elon Musk revocable trust would pay the penalty to end the SEC’s lawsuit under the plan, which is still subject to court approval. Musk didn’t admit to the regulator’s allegations, according to a filing on Monday.
It’s a much smaller penalty than what Musk’s attorney said the SEC initially sought. The agency in December 2024 asked Musk to pay more than $200 million to settle, according to a letter his lawyers sent to the agency and reviewed by Bloomberg News.
The SEC sued Musk in January 2025, days before President Donald Trump took office, alleging Musk blew the deadline to disclose he accumulated more than 5% of the social-media platform’s stock. That delay cost Twitter shareholders more than $150 million, the regulator said. Musk later bought the company in 2022 and renamed it X.
An SEC spokesperson said the deal, if finalized, would be the largest penalty the agency has levied against an entity or individual for allegedly failing to file a beneficial ownership report on time.
Musk’s attorney, however, called it a “small fine.”
“Mr. Musk has now been cleared of all issues related to the late filing of forms in the Twitter acquisition, as we said from the outset he would be,” Alex Spiro, a lawyer for Musk, said in a statement. “A trust vehicle has agreed to a small fine for being late on one filing.”
The SEC originally sought a civil penalty and a return of illegal profits, plus interest. The deal announced Monday represents only a civil penalty.
At the time of the January 2025 lawsuit, Musk was a key Trump ally who had donated hundreds of millions of dollars to help him get elected. Once Trump took office, Musk oversaw a massive restructuring of the federal government before having a public falling out with the president.
The case was also fraught within the agency. Commissioner Mark Uyeda, a Republican who later would serve as the SEC’s acting chairman, took the unusual step of asking enforcement staff members to declare the case wasn’t motivated by politics, Bloomberg News reported in February 2025.
The agency said the billionaire taking a huge position in the company would have sent the stock price soaring if the public knew and that investors who sold their shares missed out on big gains. Musk also stockpiled shares at an unfair discount behind the scenes, according to the lawsuit.
Once he properly disclosed his purchase, Twitter shares surged 27%, the lawsuit said.
The SEC first started probing Musk’s Twitter purchases in 2022. In September 2024, Musk stood up SEC attorneys who flew to Los Angeles for his deposition in the case, choosing to attend a rocket launch for his SpaceX company instead. Musk offered a few thousand dollars to cover the government lawyers’ travel expenses. The agency balked.
When the SEC filed its lawsuit, Musk’s attorney accused the agency of waging a multi-year “campaign of harassment” against the billionaire. He said at the time that the type of allegations against Musk would normally only carry a nominal penalty.
Musk sought to dismiss the SEC’s case in August, calling it “a waste of this court’s time and taxpayer resources.” The SEC responded by urging the judge to find Musk liable without a trial and said there is “absolutely no dispute” the billionaire missed the deadline.
Musk still faces a class-action investor suit over the same missed disclosure deadline.
Photo: Elon Musk Photographer: Chip Somodevilla/Getty Images
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