Elon Musk has agreed to pay $1.5 million to settle U.S. Securities and Exchange Commission (SEC) allegations that he cheated Twitter shareholders in 2022 by failing to properly disclose his growing stake in the social media company, Bloomberg reported Monday.

An Elon Musk revocable trust would pay the penalty to end the SEC’s lawsuit under the plan, which remains subject to court approval. Musk did not admit to the regulator’s allegations, the news service said, citing a filing on Monday.

The settlement is far smaller than what Musk’s attorney said the agency had initially sought, Bloomberg said. The SEC in December 2024 asked Musk to pay more than $200 million to resolve the matter, according to a letter from his lawyers to the agency reviewed by the news outlet. 

The SEC sued Musk in January 2025, days before President Donald Trump took office, alleging that the billionaire blew the deadline to disclose he had accumulated more than 5 percent of the social-media platform’s stock. The regulator alleged the delay cost Twitter shareholders more than $150 million, according to the report.

The agency alleged that Musk’s accumulation of a large stake would have sent the stock price soaring had it been disclosed, and that investors who sold their shares missed out on substantial gains, according to Bloomberg. The lawsuit also said Musk stockpiled shares at an unfair discount behind the scenes, and that once his purchase was properly disclosed, Twitter shares surged 27 percent. 

Musk went on to acquire the company later in 2022 and rename it X, the report noted.

The SEC first began investigating Musk’s Twitter purchases in 2022. In September 2024, Musk skipped a deposition with SEC attorneys who had flown to Los Angeles, choosing instead to attend a rocket launch for his SpaceX company, the news service said. Musk offered a few thousand dollars to cover the government lawyers’ travel expenses, an offer the agency rejected, according to Bloomberg.

An SEC spokesperson told Bloomberg that the deal, if finalized, would be the largest penalty the agency has imposed against an entity or individual for allegedly failing to file a beneficial ownership report on time.

Musk’s attorney, by contrast, characterized the settlement as a vindication. “Mr. Musk has now been cleared of all issues related to the late filing of forms in the Twitter acquisition, as we said from the outset he would be,” Alex Spiro, a lawyer for Musk, said in a statement quoted by the news outlet. “A trust vehicle has agreed to a small fine for being late on one filing.”

The SEC had originally sought a civil penalty plus a return of illegal profits with interest, according to the report. Monday’s deal covers only a civil penalty.