Elizabeth Warren sent letter to Tesla’s board accusing Elon Musk of ‘inevitable conflicts’ after he took over Twitter

Senator Elizabeth Warren (D-MA) has sent a letter to Tesla’s board accusing CEO Elon Musk of “inevitable conflicts” and the possibility of “embezzlement of company assets” in connection with his $44 billion acquisition Twitter.

Warren expressed concern about how Tesla’s board has treated Musk since becoming CEO of Twitter, arguing that his actions may not be in the “best interests” of the company. Tesla and its shareholders. She said the council’s “legal responsibility” was to deal with the situation.

“That responsibility includes ensuring that Mr. Musk is an effective CEO and that he fulfills his legal obligation to act in the best interest of Tesla and all of its shareholders, not just himself. him,” she wrote in a letter to Tesla president Robyn Denholm, on Sunday.

In the first weeks after taking over Twitter, Musk’s leadership raised concerns about whether he was “moving Tesla resources into Twitter,” Warren wrote, citing reports. report that request Musk used Tesla software engineers at Twitter.

It raises questions about whether Mr. Musk is “appropriating resources from a publicly traded company, Tesla, to benefit his own private company, Twitter,” Warren wrote. Doing so, she said, would “violate” Musk’s legal obligations to Tesla and raise questions about the board’s competence.

Warren mentioned an unnamed employee told CNBC that it is nearly impossible to turn Musk off without facing consequences later. Warren says:

Since Musk’s acquisition of Twitter, many advertisers have pull their ads from Twitter, resulting in a decrease in revenue. Warren said that “Twitter desperate for revenue to cover new debts can also create conflict.”

For example, Musk could “change the Twitter algorithm so that praises of Tesla products receive more attention and criticisms of Tesla products are silenced.” He can also ask Twitter to give Tesla free ads, or it might charge Tesla too much for ads. Either way, Warren says it’s a conflict of interest.

Musk and Tesla are “inextricably linked,” Warren said, which means his actions as Twitter’s CEO, as well as the way Twitter is operated and perceived, could be harmful. for the Tesla brand.

This year, Tesla stock is down more than 62%, partly because investors are increasingly concerned about Musk’s purchase of Twitter and his focus on that company at Tesla’s expense.

“Tesla’s losses don’t come naturally: while not all of the losses can be attributed to Mr. Musk’s decision to take over Twitter, there seems to be a direct connection, with the one analyst called the Twitter deal a “gull” stalking Tesla,” Warren wrote.

She also raised dozens of questions to the board about any formal or informal agreements between Tesla and Twitter. Additionally, she asked about any safeguards the board has in place to avoid conflicts of interest involving Musk and whether the board has reviewed Musk’s actions in relation to the two companies. you or not.

“Despite concerns about Mr. Musk’s acquisition of Twitter while he was CEO of Tesla, it remains unclear whether the Tesla Board of Directors – the key decision-making body within the company – will is managing the company adequately or whether it has established clear rules and policies. to address the risks to Tesla posed by Mr. Musk’s dual role,” Warren wrote.

Musk, Tesla and Twitter did not immediately respond luck Request comments.

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