Tesla shares drop after Musk mocks SEC on Twitter

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The CEO of Tesla, Elon Musk has mocked the Securities and Exchange Commission by calling the organisation the "Shortseller Enrichment Commission" only days after settling charges of fraud brought against him by the agency.

Musk tweeted August 7 that he had "secured" funding to privatize the electric automaker at $420 a share, causing a brief spike in Tesla's share price.

A 1:16 p.m. California time, Mr. Musk's Twitter account tweeted, "Just want to [sic] that the Shortseller Enrichment Commission is doing incredible work".

Musk also dragged BlackRock Inc. into his long-running dispute with short sellers, claiming that the fund manager was reaping heavy profits by lending shares they hold to this group of investors.

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"One Barclays analyst told CNN that shares in Tesla carry a "$130 Musk Premium" which would evaporate if he were deposed.

In addition, Musk will step down as Tesla's Chairman and will not seek re-election for at least three years.

Shares of Tesla fell Friday morning after CEO Elon Musk's latest tweet seemed to reignite drama between him and the SEC. The tweets resulted in a suit from the SEC against Elon Musk, in which the SEC said some of the tweets were "false and misleading".

"I have lost 30 years of my life savings all in $tsla thanks to your tweets please stop", TrendTrader007 wrote.

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However, Musk had been acting erratically for months even before the take-private tweet and the subsequent interviews with the Times and Rogan.

Judge Nathan said the parties would have until October 11 to submit a joint letter explaining why their settlement was fair and reasonable and would not hurt the public interest.

Tesla declined to comment. "The vast majority of settlements like this are approved by courts".

In Musk's case, the suggested price of $420 - which was reportedly published simply in order to amuse his girlfriend - set Tesla's valuation at roughly $70 billion, far beyond market cap.

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The settlement, which still must be approved by a federal judge, includes a provision meant to rein in the Tesla chief's much-criticised use of Twitter.