This is bad news for Elon Musk -- and it's likely to deepen his anger at federal regulators.
The Tesla CEO has for four years battled the Securities and Exchange Commission over his tweets, including his summer 2018 posts in which he said he wanted to take Tesla private and had secured financing for the deal.
The serial entrepreneur reached a settlement with the federal agency to end the investigation. In the accord, Musk and Tesla each agreed to pay a $20 million fine and he stepped down as Tesla's chairman. And the board was obligated to review his "communications with investors."
In October 2022 the billionaire acquired the Twitter microblogging website. And in recent months, the SEC opened an investigation into late-2021 tweets in which Musk solicited advice from Twitter users to sell some of his Tesla shares.
The SEC suspects the techno king, as he's known within the company, of violating the 2018 settlement. Musk has disputed the idea and is fighting back, accusing the federal agency of violating his free-speech rights.
The FTC Wants to Depose the Billionaire
Now, besides the SEC inquiry, Musk is in the crosshairs of another powerful U.S. regulator, the Federal Trade Commission. This agency has opened an investigation into Twitter's privacy and security practices. This investigation has escalated, according to a report released March 7 by the Republican-led House Judiciary Committee.
The FTC wants to depose Musk as part of this investigation and has requested numerous documents from Twitter, including communications related to the company's series of layoffs. When he took over, Twitter cut at least 5,200 of the platform's 7,500 jobs. On Nov. 7 the firm eliminated half its workforce in 24 hours.
The agency also asked for documents related to the so-called Twitter Files, which include information from the platform intended to prove that Twitter 1.0 -- pre-Musk -- had implemented practices to muzzle conservative voices. These internal platform documents were given to some journalists.
The House judiciary panel said it "recently obtained new, nonpublic information that falls directly within the Committee’s mandate to investigate and report on instances of the federal government’s authority being weaponized against U.S. citizens." (You can read the report here.)
"Consisting of over a dozen FTC letters to Twitter that -- in the span of less than three months following Musk’s acquisition -- make more than 350 specific demands, this information shows how the FTC has been attempting to harass Twitter and pry into the company’s decisions on matters outside of the FTC’s mandate."
Musk has become the Republicans' new hero after his determination to make Twitter 2.0 a bastion for conservatives. Operationally, this has meant that any tweet is now accepted on the platform as long as it does not violate the law. But this approach, according to civil-rights groups, has led to hateful, racist and anti-Semitic messages, as well as general misinformation, to proliferate on the platform.
'Shameful Case of Weaponization': Musk
According to the congressional report, the FTC has demanded that Twitter provide, among other things:
-Information relating to journalists’ work regarding the 'Twitter files,'
- Internal communication "relating to Elon Musk," by any Twitter personnel -- including communications sent or received by Musk himself -- not limited by subject matter, since the day Musk bought the company;
- Information about whether Twitter is "selling its office equipment”;
- All the reasons Twitter terminated former Twitter employee and FBI official Jim Baker;
- When Twitter "first conceived of the concept for Twitter Blue,” Twitter’s new $8-a-month verified-account subscription;
- Information disaggregated by "each department, division, and/or team."
Twitter is currently under a consent decree with the FTC, which means the federal agency can monitor the platform's privacy practices. In this case, the layoffs made by Twitter affected the employees who were in charge of protecting privacy and security on the platform.
After the congressional report was published, Musk did not hesitate to vent his anger against the FTC, accusing it of political attacks and more.
"A shameful case of weaponization of a government agency for political purposes and suppression of the truth!" the billionaire slammed the FTC.
The FTC didn't immediately respond to a request for comment.
