The United States Securities and Exchange Commission (SEC) claims Elon Musk failed to disclose his Twitter shares on time before his US$44 billion purchase in October 2022.

The complaint, submitted in a federal court in Washington, DC, says that Musk began buying Twitter shares in early 2022.

He acquired more than 5% of the company’s common stock by mid-March.

SEC rules mandate that this stake be disclosed within 10 days, but the lawsuit claims Musk delayed it until April 4, 2022.

According to the SEC, Musk’s delay in revealing his ownership may have led to a suppressed stock price. By the time he disclosed his holdings in early April, the stock price had risen by over 27%.

The filing also alleges that Musk underpaid Twitter investors by more than US$150 million due to stock purchases made before his disclosure.