The US Securities and Exchange Commission (SEC) has reportedly asked a judge to hold outspoken Tesla CEO, Elon Musk, in contempt for violating his settlement with the agency with a tweet last week.
Bloomberg reports that the tweet in question, made on February 19 (US time), violates the settlement Musk made with the SEC last year that required him to seek pre-approval from the company for social media posts and "other written communication that would be material to the company or investors".
"He once again published inaccurate and material information about Tesla to his over 24 million Twitter followers, including members of the press, and made this inaccurate information available to anyone with Internet access," the SEC said in documents filed in Manhattan federal court.
Tesla made 0 cars in 2011, but will make around 500k in 2019— Elon Musk (@elonmusk) February 20, 2019
Above: Musk's tweet is claimed to be in violation of the settlement he made last year with the SEC
Following the SEC's filing, Tesla shares fell by as much as 5.4 per cent as of Monday in New York.
This latest news comes after Musk was forced to step down as Tesla chairman in September last year following a series of tweets about taking Tesla private.
"They have to view the conduct as akin to another violation of securities laws to take this step," said Brad Pennett, former head of enforcement at the Financial Industry Regulatory Authority.
"It’s a very novel situation where someone is running an enterprise with this kind of market cap and gives the SEC cause for concern that the person is not capable of following the securities laws."
Further details are still to come as the story develops. Stay tuned.