{"text":[[{"start":12.85,"text":"Elon Musk’s settlement with the Securities and Exchange Commission raises “red flags”, a federal judge said on Wednesday, as she refused to immediately sign off a $1.5mn deal with the regulator for the billionaire to end a lawsuit over Twitter stock disclosures."}],[{"start":28.6,"text":"US district judge Sparkle Sooknanan said she would not “rubber stamp” the settlement and that aspects of the deal “raise red flags for me”, according to Bloomberg and other news reports. The settlement was agreed by the SEC and Musk’s trust earlier this month."}],[{"start":45.25,"text":"“Is Mr Musk getting some kind of special treatment in this case?” she asked."}],[{"start":50.55,"text":"Sooknanan also suggested Musk might have been seeking to avoid a finding against him by the court, and asked both sides to brief her again before she decides on the settlement."}],[{"start":60,"text":"The proposed settlement between the SEC and Musk, a major Donald Trump donor and former member of the administration, came after the agency showed leniency towards several figures and businesses with ties to the president. "}],[{"start":73.25,"text":"It has dismissed cases against crypto exchanges Coinbase and Kraken, both of which have donated to Trump."}],[{"start":79.55,"text":"Musk’s lawyers had previously disclosed that the SEC’s enforcement lawyers had not been “fully read in” on the settlement. Margaret Ryan, the regulator’s enforcement director, resigned days after that disclosure in March."}],[{"start":91.85,"text":"The SEC sued Musk, the world’s richest man, under Joe Biden’s administration in January 2025, days before Trump returned to the White House."}],[{"start":102.19999999999999,"text":"The regulator alleged he had waited 11 days too long to disclose his ownership stake in Twitter, as required by securities law, ahead of his attempt to acquire the social media platform."}],[{"start":112.85,"text":"The SEC said the delay allowed Musk to buy more than $500mn of additional shares at artificially low prices, underpaying sellers by at least $150mn."}],[{"start":124.8,"text":"On the day his stake was reported, Twitter shares rose more than 27 per cent. Musk ultimately purchased the platform, since renamed X, for $44bn in October 2022."}],[{"start":136.3,"text":"This month’s proposed settlement would have freed Musk of any further repercussions. People familiar with the discussions defended the deal, saying it was the largest sum ever proposed to settle a violation of Section 13(d) of the Securities Exchange Act."}],[{"start":151.25,"text":"It was made possible by an unusual procedural step, in which the SEC amended its complaint to add Musk’s trust, through which the billionaire bought his Twitter shares in 2022, as a defendant. As part of the proposed deal, the trust would not need to acknowledge any wrongdoing, and Musk would face no personal penalties."}],[{"start":170.3,"text":"Musk’s lawyer Alex Spiro celebrated after he and the SEC submitted the settlement proposal earlier this month. “Elon won, and a trust entity took a small fine, without admitting anything, for being some days late on a filing,” he told the FT at the time. “Case closed.”"}],[{"start":185.60000000000002,"text":"Spiro did not immediately respond to a request for comment on Wednesday’s news."}],[{"start":191.75000000000003,"text":"In court papers, Musk had said the rules on disclosing share purchases were vague and also violated his First Amendment free speech rights."}],[{"start":199.90000000000003,"text":"Musk is facing a separate lawsuit from Twitter shareholders over the disclosure of share purchases that is working its way through a New York federal court."}],[{"start":209.15000000000003,"text":"This article has been amended to correct who agreed the settlement with Musk"}],[{"start":221.85000000000002,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1778728861_7985.mp3"}