>> Worries about the future of Tesla CEO and chairman, Elon Musk, sending the stock into a 14% tailspin Friday, wiping out more than $7 billion in market value in the worst day for the stock since November 2013. The stock stampede coming one day after the Securities and Exchange Commission sued to push Musk out of his job, accusing him of securities fraud and lying to investors.
>> Neither celebrity status nor reputation as a technological innovator provide an exemption from the federal securities laws.>> The charges stem from Musk's now infamous tweet back in August, quote, I'm considering taking Tesa private at $420. Funding secured. According to the charges made by the SEC, that tweet along with others that followed were false and misleading statements.
Adding that Musk's tweet caused market chaos and harmed Tesla investors. Reuters' correspondent, Alexandria Sage is on the story.>> The negative way of looking at this, which probably would be shared by most investors, is that this is a huge blow to Tesla's brand to their ability to attract new investors.
Not being sure whether Musk will have a future at Tesla.>> Sources told Reuters, Musk could agree to settle the SEC case but is ready to go court. Tesla did not immediately respond to a request for comment. Many Wall Street firms question what Tesla's viability would be like without Elon Musk at the helm, but advised investors on Friday to stay with the stock for now.
Bond investors were less forgiving, the cost of insuring Tesla's debt against default rose to it's highest price ever. This is not Tesla's only legal problem, earlier this month Tesla confirmed that the Department of Justice was also investigating the company over those tweets.