US financial regulatory agency says Musk violated deal

US stock regulators have accused Elon Musk of violating a court-endorsed deal between the electric automaker and the regulatory agency, and this latest apparent slip by the tech wunderkind could cost him dearly.

The action by the powerful Securities and Exchange Commission, with which Musk appears to be doing battle, does not really come as a surprise.

On February 19, he tweeted that Tesla would make 500,000 cars in 2019 -- up from the 400,000 that the company had estimated until then, as it grapples with production problems with the Model 3.

In his latest display of seemingly erratic behavior, Musk corrected himself four hours later.

He said Tesla would indeed produce about 400,000 cars this year. "Meant to say annualized production rate at end of 2019 probably around 500k," he wrote.

The SEC said the tweets violated a deal under which his tweets had to be reviewed prior to being published.

That constraint followed Musk's now famous tweet last year about planning to take the company private, a claim which proved unfounded but rattled markets.

On "February 19, 2019, Musk tweeted, 'Tesla made 0 cars in 2011, but will make around 500k in 2019.' Musk did not seek or receive pre-approval prior to publishing this tweet, which was inaccurate and disseminated to over 24 million people," the SEC said in court filing in New York federal court.

"Musk has thus violated the court's final judgment by engaging in the very conduct that the pre-approval provision of the final judgment was designed to prevent," it said.

Musk took to Twitter to defend himself later Monday, saying the "SEC forgot to read Tesla earnings transcript, which clearly states 350k to 500k." "How embarrassing," he added.

But Musk also spoke of his "great respect for judges."