NEW YORK/WASHINGTON (Reuters) – Last month, in the final days of the Biden administration, the U.S. Securities and Exchange Commission set a tight deadline of days for Elon Musk to pay a settlement or face charges related to his role in Civil charges related to securities violations during the $44 billion acquisition of Twitter in 2022.
Musk himself revealed the news in a social media post: “Oh Gary, how could you do this to me?” he wrote, referring to SEC Chairman Gary Gensler.
He added a smiley face emoji but attached a legal letter denouncing the “ill-motivated” ultimatum: “We demand to know who directed these actions — whether it was you or the White House.”
An SEC spokesman declined to comment on the incident. The White House did not respond to a request for comment.
The SEC is not the only investigative agency that Musk has defied and alleged political harassment. The billionaire has long complained about government oversight, portraying himself as a victim of bureaucratic fanatics stifling potentially life-saving innovations at his companies.
The White House will soon be occupied by Donald Trump (who Musk spent more than $250 million to help elect) rather than Joe Biden, who appointed Gensler. Trump has appointed a new SEC chairman to replace Gensler, who plans to resign when Trump takes office.
Musk’s potential for extraordinary influence over the new administration has raised questions about the fate of federal investigations and regulatory actions affecting his business empire, according to three sources familiar with SpaceX and Tesla’s operations and the companies’ interactions. At least 20 of these investigations and regulatory actions are ongoing.
The investigation includes a review of alleged securities violations; questions about the safety of Tesla’s Autopilot and Full Self-Driving (FSD) systems; possible animal welfare violations in Neuralink’s brain chip experiments; and alleged pollution, Recruitment discrimination and licensing issues.
Musk, Tesla, SpaceX and Neuralink did not respond to requests for comment. Before the election, Musk posted: “I never asked [Trump] He also offered me no favors.
A Trump transition spokesman called Musk a “brilliant” entrepreneur and said the Trump administration would ensure law and order and “treat all Americans equally.”
Current and former U.S. officials have said Trump-appointed agency and department heads may shelve or drop cases related to Musk.
For example, one current Justice Department official and three former Justice Department officials said Trump’s Justice Department picks include lawyers who defended him in his criminal and impeachment trials, as well as an FBI director nominee whom Musk has verbally supported. He has repeatedly vowed to hunt down Trump’s enemies.
Barbara McQuade, a former U.S. attorney in Detroit during the Obama administration, said lower-level Justice Department officials could also exercise prosecutorial discretion to avoid prosecuting Musk given his ties to Trump. The company is actively investigating. “As long as they want to please their boss, I think they know what to do.”
Some legal experts downplayed the risk of political interference by Musk, noting that the lack of progress in the investigation could indicate a lack of evidence.
Legal experts say prosecutors who believe they have sufficient evidence are also likely to move forward with the case regardless of Musk’s role.
“I don’t think the risk of Musk infiltrating the case is great,” said Robert Frenchman, a white-collar defense attorney at the New York law firm Dynamis. “Most prosecutors will bring cases they think they can win.” “
Representatives from the Justice Department and all departments and agencies with ongoing investigations into Musk or his companies have not commented on the investigation or their ability to enforce regulations against Trump allies during Trump’s second term. The EPA and the National Highway Traffic Safety Administration (NHTSA) said they will continue to fulfill their legal and regulatory responsibilities.
“First Partner”
Since the election, Musk has called himself Trump’s “No. 1 buddy,” frequenting Trump’s Mar-a-Lago club in Florida, spending Thanksgiving with the president-elect’s family and publicly commenting on his Cabinet appointments.
Trump tapped Musk to co-lead a new Department of Government Effectiveness, a private entity that advises on budget cuts and regulations. It’s unclear what powers the character will have.
Musk touted his newfound influence and gave specific examples of how he leveraged it. Before the election, Musk said he would seek to use his position as efficiency czar to advance national self-driving car regulations that would almost certainly benefit Tesla and eliminate “unreasonable” rules such as those that led to pollution from SpaceX Penalties Rules.
For nearly a decade, NHTSA officials have scrutinized Tesla, sometimes angering Musk. In a 2016 phone call, he launched into a profanity-laced rant against regulators, who were conducting multiple investigations into Tesla’s Autopilot assist system after a fatal crash, according to two people familiar with the matter. Currently, the National Highway Traffic Safety Administration (NHTSA) has five ongoing investigations involving the driver assistance technology and other operations of Tesla vehicles.
Tesla accuses Tesla drivers of defending themselves in accident lawsuits and investigations involving FSD and Autopilot, and says it has warned drivers to be careful.
The U.S. Department of Justice’s investigation into whether Tesla and Musk exaggerated the self-driving capabilities of their vehicles is one of the challenges facing investigators. Prosecutors have been working to prove that Musk and Tesla crossed the line of legal promotion and knowingly made false claims that misled investors and harmed consumers. A person familiar with the matter said the investigation stalled before the election, in part because of legal hurdles.
A separate investigation by the U.S. Attorney’s Office in Manhattan involves the mileage of Tesla vehicles, after a Reuters investigation found that the automaker manipulated in-dash displays to provide drivers with “optimistic” forecasts , telling them how many miles they can travel using battery power. It’s unclear how far the investigation has progressed.
“To our knowledge, no government agency has concluded that any wrongdoing occurred during any ongoing investigation,” Tesla said in its quarterly filing with the Securities and Exchange Commission.
Reuters first reported that some of Trump’s auto policy advisers have suggested eliminating the requirement for automakers to report accident data involving self-driving systems, a measure that could weaken NHTSA’s ability to investigate and regulate the safety of emerging technologies.
Rockets and NASA
SpaceX has faced little regulatory scrutiny because the government has outsourced most of its space missions to Musk’s rockets and satellites, according to two former SpaceX officials and a current administration official familiar with SpaceX’s interactions with NASA, the EPA and the FAA. Corporations Regulatory Authority (FAA).
At a September summit, Musk called an EPA investigation that led to SpaceX agreeing to a $148,378 fine for dumping contaminants that Musk said was actually “drinking water” as “crazy.” .
The FAA separately proposed in September to fine SpaceX $633,000 for allegedly failing to comply with licensing requirements and obtain change approvals between two launches in 2023.
In September, shortly after the FAA fined SpaceX and delayed a launch, Musk called on FAA Administrator Mike Whitaker to resign. Whitaker said last month he would resign before Trump takes office.
The Wall Street Journal reported in October that Musk has been in regular contact with Russian President Vladimir Putin. Three sources familiar with SpaceX’s interactions with the government said it was unlikely that there would be any review of Musk’s contacts with U.S. adversaries under Trump, who has appointed tech billionaire Jared Isaacman Jared Isaacman) to run NASA. Isaacman funded and participated in two private space missions involving SpaceX.
NASA declined to comment, and Isaacman and Isaacman’s media representatives did not respond to requests for comment.
Musk did not respond to a request for comment about his contacts with Putin. At one point, he responded to a social media post on X with two laughing and crying emojis, suggesting Musk’s critics were trying to paint him as a Russian agent.
(Mike Spector and Chris Prentice reported in New York, Rachel Levy and Marissa Taylor in Washington. Chris Kirkham in Los Angeles and David Shepherdson in Washington Additional reporting; Editing by Anna Driver and Brian Trevinot)
