06:32 AM EST, 01/15/2025 (MT Newswires) -- The US Securities and Exchange Commission sued Tesla (TSLA) Chief Executive Elon Musk for allegedly breaching federal securities laws by failing to disclose his active stake in Twitter in a timely manner in 2022, before his eventual purchase of the social media platform now known as X.

The SEC, which filed the complaint against Musk in the US District Court of Columbia, claimed the billionaire was more than 10 days late in publicly disclosing that he had acquired more than 5% of Twitter's stock in March 2022. Musk disclosed his beneficial ownership of over 9% in Twitter on April 4, 2022, leading to a more than 27% jump in the company's stock price on the day, according to the regulator's Tuesday filing.

The late disclosure allowed Musk to continue purchasing the social media firm's shares at "artificially low prices" and "underpay" investors by at least $150 million, the SEC said. During the period between the required disclosure and his actual filing, Musk spent more than $500 million in buying additional Twitter stock, according to the regulator.

The Tesla and SpaceX CEO acquired Twitter in October 2022 for $44 billion and rebranded the company to X the following year.

"Musk's violation resulted in substantial economic harm to investors selling Twitter common stock between March 25, 2022 and April 1, 2022," the SEC said in its complaint. "Those investors, unaware that Musk had accumulated more than 5% of Twitter common stock and unaware of Musk's overall investment purpose, sold their shares at artificially low prices because the market had not yet priced in this material information."

The SEC requested the court to issue a final judgement on the matter and order Musk to pay a civil penalty for the alleged violation.

Tesla and Musk didn't immediately respond to a request for comment by MT Newswires. Replying in a thread on a post in X, Musk seemingly referred to the SEC as a "totally broken organization." The billionaire also accused the regulator of wasting time "when there so many actual crimes that go unpunished."

"Today's action is an admission by the SEC that they cannot bring an actual case -- because Mr. Musk has done nothing wrong and everyone sees this sham for what it is," Quinn Emanuel Partner and Musk's lawyer, Alex Spiro, said in an email to MT Newswires. The "administrative failure" offense, even if proven by the authorities, carries a "nominal penalty," according to Spiro.

In 2022, the SEC was reported by various media publications to have been investigating Musk and his brother over potentially violating insider trading rules. Last month, Musk shared a letter from Spiro on X that said the SEC issued a settlement demand requiring Musk either "accept a monetary payment or faces charges on numerous counts."