Tesla CEO Elon Musk and his brother, Kimbal Musk, are under investigation by the US regulator for possibly violating “insider trading rules” in their recent stock sales, the Wall Street Journal reports. According to a source familiar with the matter, the Securities and Exchange Commission (SEC) opened an investigation into whether Elon Musk and his brother abused insider information when selling Tesla shares. The SEC probe began last year when Kimbal sold shares of the electric car maker worth $108 million. Notably, this happened one day before Elon Musk launched an informal poll asking his Twitter followers whether he should sell his stake in the company. Right after that, the stock plummeted. The US regulator views such actions as unfair trade practices that violate the rules of exchange trading. For your reference, CEOs and employees of public companies are prohibited from buying or selling company’s shares. This is especially relevant for those employees who have insider information. By the way, Kimbal Musk is a member of Tesla’s board of directors. Back in 2018, Tesla’s shareholders sued Elon Musk, claiming that his actions brought them losses. The lawsuit came after Elon Musk announced he was going to buy the company’s shares. As a result, he had to step down as the chairman of Tesla’s board.
