Tesla and Musk ended up reaching a settlement with the SEC.Īs part of the settlement, Musk agreed to step down from the role of chairman of the board and both Tesla and Musk each had to pay $20 million fines. The Security and Exchange Commission (SEC) judged that Musk exaggerated when saying that the funding was “secured.” In 2018, the SEC filed a lawsuit against Elon Musk over his infamous “funding secured” comment regarding his failed attempt to take Tesla private.

Speaking of the SEC, the agency might be interested in the current situation.

If the CEO has also started selling shares, Tesla will have to disclose in an SEC filling by the end of the week. Kimbal managed to sell at Tesla’s all-time high just days before his brother announced his plan to sell 10% of his stake, which likely partly triggered the important stock correction. Today, Tesla’s trading volume surged to 35 million shares by midday with massive sales at around 10 a.m.: Musk selling Tesla shares casts a negative shadow on the stock, no matter the reason he gives for it, but with the kind of volume he is talking about selling, the actual selling pressure could also contribute to the crash.Īs of last week, the CEO was holding 170.49 million Tesla shares, which means that 10% is 17 million shares or about the average daily volume of Tesla shares exchanging hands. Today, Tesla had its biggest stock price crash in a long time, dropping by as much as 10% intraday. It put a stop to Tesla’s historic rally that saw its market capitalization of over $1 trillion. Last weekend, Elon floated the idea that he would sell 10% of his stake in Tesla if a Twitter poll would agree, which it unsurprisingly did.

It’s not clear whether Musk has started selling, but his brother, Kimbal Musk, managed to sell $100 million just before Elon publicized his withdrawal. With another important drop today, Tesla (TSLA) has now dropped more than 12% since CEO Elon Musk announced that he would sell 10% of his stake.

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