JPMorgan is suing Tesla and CEO Elon Musk over an email message that Musk sent to Tesla investors warning of a March 1, 2018 write-down. JPMorgan says Tesla owes it about $162 million because it’s ultimately owed as much as $640 million for taking those investment positions.
But now the bank has gotten additional legal help from the US Securities and Exchange Commission.
The SEC filed a new civil complaint, this time against Musk for filing the initial emails from Tesla that suggested there would be a write-down.
This comes three months after the SEC filed a criminal case against Musk for allegedly tweeting false information about taking Tesla private.
Last month Musk agreed to a five-year term as part of that agreement.
The SEC is currently trying to get Musk and Tesla to pay $20 million for securities fraud, but said in a statement that if Musk didn’t take that amount of money then it would make it tougher for Musk to argue against paying more.
But the SEC said that “the financial penalties pale in comparison to the harm suffered by Tesla and its shareholders.”
“The defendants’ misconduct harmed Tesla’s investors by improperly concealing material information about Tesla’s financial condition and exposing them to significant losses,” said Stephanie Avakian, co-director of the SEC Enforcement Division, in a statement.
The SEC now wants to make sure that Musk doesn’t do anything else like write down the value of the company and yet again try to use that as an excuse to avoid paying the SEC’s fine.
JPMorgan says that the “reputation risk” that Musk has in regards to false and misleading disclosures is damaging to his and the company’s ability to do business in the future.
A trial for the criminal charges is set for October.
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