DEAL

Elon Musk to Step Down as Tesla Chairman in SEC Settlement

He will still be CEO, but will also have to pay a $20 million penalty.

Tesla’s Elon Musk will step down from his role as board chairman for three years, and pay a $20 million penalty under a settlement with regulators in the wake of “misleading” tweets about taking the company private, officials said Saturday. Musk’s departure as chairman, which will take place in 45 days, stems from a settlement between him and the Securities and Exchange Commission shortly after the regulatory agency slapped the embattled entrepreneur with securities fraud charges. The SEC complaint cited Musk’s infamous Aug. 7 tweet. In that missive, Musk claimed he could take the electric car company public at a whopping $420 per share. Musk, the SEC alleged, misled investors by making it seem as if he had already landed funding - and “that the only remaining uncertainty was a shareholder vote.” Under the settlement agreement, Tesla will also pay a $20 million penalty, and “establish a new committee of independent directors and put in place additional controls and procedures to oversee Musk’s communications,” the SEC said in a press release.