The Securities and Exchange Commission reached a $1.5 million settlement with Elon Musk on Monday in a lawsuit that accused the world’s richest person of breaking securities law during his purchase of Twitter, now called X.
The S.E.C. had said Mr. Musk hid purchases of the social media company’s stock in 2022 and did not disclose them in a timely manner, allowing him to underpay when he bought Twitter for $44 billion later that year. Mr. Musk’s revocable trust will pay the settlement, according to a filing in federal court in Washington. The judge has not yet approved the agreement.
The settlement ends a Biden administration-era case against Mr. Musk, 54, a former adviser to President Trump. Since last year, the Trump administration has pulled back on some of the most aggressive law enforcement over allegations of corporate malfeasance. Notably, the S.E.C. retreated from a swath of lawsuits against the cryptocurrency industry. Government officials also settled over the last year with the targets of antitrust and consumer protection lawsuits, including Amazon and Live Nation, the owner of Ticketmaster.
The agreement helps Mr. Musk reduce his legal entanglements as his space venture, SpaceX, prepares for an initial public offering. The rocket maker, which owns X, could go public as soon as June in what is expected to be a generational wealth-making event. SpaceX has valued itself at more than $1 trillion.
The S.E.C. said the settlement was the largest penalty ever for the type of case that had been brought against Mr. Musk. He and his lawyer Alex Spiro did not respond to requests for comment.
Mr. Musk previously criticized the former S.E.C. chairman who brought the lawsuit, Gary Gensler. Mr. Musk had said on X that the agency’s claims were politically motivated.
The S.E.C., which requires investors to disclose big stock purchases to signal a potential takeover of a company, sued Mr. Musk in January 2025. He had begun buying shares in Twitter in January 2022, according to the lawsuit. Soon after, a stockbroker managing his purchases warned Mr. Musk’s financial manager that the billionaire needed legal advice about disclosing his position, the regulators said. In mid-March 2022, Mr. Musk passed a 5 percent ownership threshold for Twitter, the point when a public disclosure is required.
Yet Mr. Musk continued buying Twitter shares and did not disclose his stake until April 4, 2022, the S.E.C. said in its complaint. After he announced his ownership of Twitter stock, the share price shot up more than 27 percent.
Because Mr. Musk waited to disclose his stake, he was able to continue buying Twitter stock at an artificially low price, saving him $150 million, the lawsuit claimed. On April 14, 2022, Mr. Musk made an offer to buy Twitter.
In a separate settlement, the Federal Trade Commission agreed to withdraw a subpoena it had sent to the liberal watchdog group Media Matters, the nonprofit said on Monday. The subpoena was part of an F.T.C. investigation that began after Mr. Musk accused Media Matters of trying to damage X’s relationship with advertisers.
In a 2023 lawsuit, X had said Media Matters “falsely portrayed” the social media site as a “risky, unsafe platform for advertisers” by highlighting ads that ran alongside neo-Nazi and white nationalist content on the platform.
Last year, Media Matters successfully sued to block the F.T.C.’s subpoena, which it called a violation of the First Amendment. On Monday, Media Matters said the agency had stated in the legal settlement that the group was “not the target of any investigation.” An F.T.C. spokesman declined to comment.
David McCabe contributed reporting.
