Elon Musk is to remain as Tesla CEO but will step down as Chairman. The move is part of a settlement with the US financial regulators, the Securities and Exchange Committee (SEC) which issued fraud charges last week. Under the terms of the deal, Musk and Tesla will also have to pay a $20 million fine each.
The fraud allegations relate to tweets sent by Musk in August in which he stated that he was considering taking the electric car maker off the stock market and placing it in private hands. He also claimed to have funding in place which valued the company at $420 a share. However, the plan was later abandoned.
Musk has 45 days to relinquish the role of Chairman. A new ‘independent Chairman’ will then be appointed. Musk will also have to comply with company procedures when tweeting about the firm from now on. Tesla and Musk have not commented on the allegations or the settlement with the SEC.