Elon Musk agreed on Monday to pay $1.5 million to end a government lawsuit accusing him of breaking stock market rules while secretly buying Twitter shares ahead of his $44 billion takeover of the social media platform in 2022.

A trust in Musk’s name will pay the fine under a deal filed in a Washington federal court, which still requires a judge’s approval. Musk did not admit wrongdoing.

What did Musk settle with the SEC over his Twitter stake?

The SEC accused Musk of missing a legal deadline requiring investors to disclose when they acquire more than 5% of a publicly traded company. Musk’s trust agreed to pay a $1.5 million penalty and promised not to violate the same rule again.

The settlement does not require him to repay money he allegedly saved by delaying the disclosure.

The rule is straightforward: once an investor crosses the 5% ownership threshold in a public company, they must disclose that stake within 10 days. The SEC said in January 2025 that Musk missed that deadline by 11 days while building his Twitter position in early 2022.

The agency said the delay allowed him to keep buying shares at lower prices, saving an estimated $150 million at the expense of other shareholders who sold without knowing a major buyer was in the market.

Did Musk admit wrongdoing in the SEC settlement?

Musk did not admit wrongdoing under the terms of the deal. His attorney Alex Spiro described the outcome as a vindication, saying Musk “has now been cleared of all issues related to the late filing of forms in the Twitter acquisition.” Spiro also told AFP that the deal was not a settlement “because he did nothing wrong” and that “the case against him was dismissed.”

The SEC amended its complaint to add Musk’s trust as a defendant and filed the proposed settlement simultaneously. If the judge approves it, the agency said it will drop Musk personally from the case, ending it entirely. The lawsuit was originally filed just days before President Joe Biden left office, and a federal judge rejected Musk’s attempt to have it thrown out in February.

What other legal cases is Musk facing over the Twitter takeover?

A separate trial in California concluded in March, when a jury found that Musk had misled Twitter investors with posts made during the chaotic 2022 takeover. Damages in that case could reach roughly $2 billion, though Musk’s lawyers have said they plan to appeal.

The SEC settlement is also the second time Musk has resolved a case with the agency. In 2018, he paid $20 million and surrendered his role as Tesla’s chairman after posting on social media that he had funding to take the electric car maker private, a deal that never happened.