Elon Musk’s expansive portfolio of companies could avoid more than $2.37 billion in potential legal liability due to his unprecedented influence over the US government, a new Senate report finds.
The figure comes from a report assembled by Democratic staff for the Senate Homeland Security permanent subcommittee on investigations (PSI) probing the impact of Musk’s closeness with President Donald Trump and creation of the Department of Government Efficiency (DOGE) on his financial interests. The staff endeavored to quantify “the financial impact of President Trump’s delegation of power on potential liabilities and scrutiny facing Mr. Musk and his companies.” To do so, it calculated the legal exposure The Boring Company, Neuralink, SpaceX, Tesla, and xAI could face as a result of federal investigations, litigation, or regulatory actions pending as of Trump’s inauguration. The staff called the number “a credible, conservative estimate.”
The subcommittee found that Musk and his companies were subject to 65 “actual or potential” actions across 11 agencies as of Inauguration Day, and said they were able to estimate potential financial liability for 40 of those. That includes up to $1.19 billion for Tesla’s allegedly misleading statements about its self-driving features, $281 million for Neuralink’s allegedly misleading representations about its risks, and more than $630,000 in fines for SpaceX allegedly evading rocket launch requirements, the Democratic staff claims. Many of the agencies that regulate Musk’s companies have been targets of cuts by DOGE.
“Mr. Musk’s position may allow him to evade oversight, derail investigations, and make litigation disappear whenever he so chooses”
Alongside the report, PSI Ranking Member Richard Blumenthal (D-CT) sent letters to the five companies asking them to respond by May 11th about their current federal investigations and litigation, and what steps they’ve taken to keep Musk’s work with the government from influencing those proceedings. He also asks the companies to preserve related communications between company employees and federal government officials, which could become relevant in future probes. While the subcommittee has subpoena powers, the Democratic minority would need support from the Republican chair to exercise them against Musk’s companies.
“Mr. Musk’s position may allow him to evade oversight, derail investigations, and make litigation disappear whenever he so chooses—on his terms and at his command,” the report says, pointing to the former Federal Aviation Administration leader’s decision to step down well before the end of his term after clashing with Musk, whose SpaceX is regulated by the agency.
Democratic staff says even the $2.37 billion figure “drastically understates the true benefit Mr. Musk may gain from legal risk avoidance alone as a result of his position in government.” That’s not only because of the other 25 pending actions it hasn’t been able to quantify, but also because Musk’s companies could avoid millions or billions of dollars more in legal fees and other spending they might incur if ordered to change their labor or other business practices. Nor does it include “many billions of dollars” Musk could make through new government contracts or “the competitive advantage they may gain by collecting intelligence on competitors,” they write.
On top of all that, Musk will save money from all the investigations that may never happen under a Trump administration, the staff writes in its letters to Musk’s companies. “The cases never filed, investigations quietly neglected, and potential witnesses silenced will be harder if not impossible to detect until Congress is provided with the information it needs.”
from The Verge https://ift.tt/h5xrYHB
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