Senator Elizabeth Warren (D-Mass.) is urging the Securities and Exchange Commission (SEC) to investigate Tesla’s board of directors for alleged conflicts of interest with Elon Musk.
The senator fired off a letter to the SEC in yet another brazen attack on the billionaire in her continuing vendetta against Musk.
“Warren’s letter comes as a follow-up to a July 2023 letter she sent to the SEC calling for Elon Musk and the board to be investigated due to what she said was the board’s ‘failure to address possible misappropriation of Tesla resources and conflicts of interest arising from Mr. Musk’s dual role at Tesla and X – renamed from Twitter,’” Fox Business reported.
“New evidence has emerged in recent months that deepen my concerns that Tesla’s Board lacks independence from Mr. Musk, who uses his control over the Board for his personal benefits, rather than in the best interest of Tesla’s shareholders,” Warren accused. “This is important information for SEC’s consideration.”
(Video Credit: CNBC Television)
Warren asserted that Musk has “exerted a high degree of control over the Tesla Board.” She pointed to the Delaware Court of Chancery ruling that the board had breached its fiduciary duties by approving Musk’s $56 billion compensation plan in connection to Tesla. Following that ruling, Musk decided to move Neuralink’s licensing to Nevada, according to the Associated Press.
The Delaware court’s ruling nixed Musk’s hefty pay package, contending that he “enjoyed thick ties with the directors tasked with negotiating on behalf of Tesla, and dominated the process that led to board approval of his compensation plan” and “Musk controlled Tesla” via board members.
“A clear, years-long pattern has emerged where the Board has failed to adequately address conduct by Mr. Musk that may harm Tesla shareholders,” Warren went on to charge.
“The senator went on to note that the Tesla board took no action when Musk publicly said he would be uncomfortable growing the EV-maker as a leader in artificial intelligence (AI) and may divert AI product development away from Tesla unless he had about 25% voting control at the company,” Fox Business reported.
“She also noted that Tesla board members have financial interests in Musk’s privately-held companies like X, formerly Twitter, and AI startup xAI – a situation she said raises ‘further concerns’ about the board’s independence in cases when ‘Musk positions the interests of Tesla against that of his own companies’ as he did in the post about Tesla and AI development,” the media outlet added.
Senator Elizabeth Warren’s Vendetta Against Elon Musk Continues as She Tells SEC Tesla May Have Violated Securities Law
Senator Elizabeth Warren is on the warpath once again, taking aim at one of her favorite targets: Elon Musk.
In a letter addressed to the Securities and… pic.twitter.com/tCZSWMAaQr
— Owen Gregorian (@OwenGregorian) March 23, 2024
It appears that Warren holds a severe grudge against Musk whom she has butted heads with in the past.
“The Board has a legal obligation to address and disclose business risks, such as financial conflicts of interest or other risks to the Board’s ability to remain independent. Despite the growing concerns by Mr. Musk’s conflicting roles at Tesla and his private companies, the Board appears to have taken no action to address these risks or protect its shareholders,” she said in the letter.
“By all appearances, it seems that the Board continues to operate as if Mr. Musk is the ‘Technoking’ who can do no wrong,” Warren bitterly claimed.
Musk wasted no time in responding to Warren’s letter, posting on X, “Senator Karen’s main economic & tax advisor is SBF’s Dad. I suspect some of this is coming from him.”
That’s a reference to fraudster FTX CEO Sam Bankman-Fried’s father.
“Warren, who sits on both the Senate’s banking and the armed services committees, had sent a similar request to the SEC last July, and a letter to Tesla’s board chair Robyn Denholm expressing similar concerns in the past,” CNBC reported.
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Author: Terresa Monroe-Hamilton
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