In More Enlightened Times, Elon Musk Would Be in the Dock

Even ignoring his highly inaccurate tweets about Tesla, things like going private and impossible promises about self-driving cars, we have the corrupt self-dealing around Tesla's purchase of Solar City.

If the SEC or the DoJ were actually interested in pursuing stock fraud, Musk would be in a world of hurt:

Back in 2016, Tesla acquired solar panel manufacturer SolarCity, billing the $2.6 billion deal as an opportunity to create "the world's only vertically integrated sustainable energy company." From a SolarCity solar panel to a Tesla battery, the company promised, the in-house supply chain would scale up clean energy for all and provide cost synergies to the businesses and shareholders.

But SolarCity, of which Tesla CEO Elon Musk was chairman, was deeply in debt at the time. Now, newly unsealed documents in an investor lawsuit say the situation was far worse than that. They allege that SolarCity wasn't just carrying a heavy debt load: it was completely insolvent.

The upshot of reams of law surrounding mergers and acquisitions is that C-suite executives and company boards of directors are supposed to make sure shareholders get the most money possible out of their investment. If they're going to sell the company, they have to make sure they're accepting the most valuable reasonable offer. Companies doing the acquiring, meanwhile, are supposed to do their homework to make sure they're not wasting their resources on a bad deal—and Tesla shareholders say the SolarCity acquisition was exactly that.

………

SolarCity only continued to function because of SpaceX money, the suit alleges:

As SpaceX's chairman, CEO, CTO, and majority stockholder, Musk caused SpaceX to purchase $90 million in SolarCity bonds in March 2015, $75 million in June 2015, and another $90 million in March 2016. These bond purchases violated SpaceX's own internal policy, and SolarCity was the only public company in which SpaceX made any investments.

The scenario described is as follows:  Musk owns over 50% of SpaceX, and you used their money to prop up Solar City until Tesla, which is a publicly traded firm, bought the solar panel installer out.

Musk's cousins founded the company, and Musk was Solar City's largest shareholder, and they all made made a lot of money as a result, Elon netted about $½ Billion, of what can only be called looting.

This is as corrupt as hell, and in the days before Reagan emasculated the SEC and the white collar crime division of the DoJ, he would be under criminal indictment, and banned from both the securities industry, as well being banned from serving as an executive or a board member of of a publicly traded company.

Of course, after Reagan, and Bush, and Clinton, and Bush, and Obama, it's, "No harm, no foul."