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Elon Musk might avoid over $2 billion in potential financial liabilities by leveraging his influence over federal mechanisms, as highlighted in a recent report from a Senate Democratic committee.
The so-called “Department of Government Efficiency,” driven by Musk, has initiated significant changes within Washington, pursuing aggressive measures to downsize agencies and reduce the federal workforce. This effort has garnered strong support from former President Donald Trump.
As Musk seems ready to reduce his involvement with DOGE-related initiatives shortly, Democrats are accusing him of exploiting his influence to sidestep oversight and eliminate investigations, maneuvering litigation to suit his needs.
The memo, prepared by staff from the Senate’s Permanent Subcommittee on Investigations, noted that on Trump’s inauguration day, Musk and his affiliated companies were under scrutiny with at least 65 “actual or potential” regulatory or enforcement actions from eleven federal entities.
These investigations collectively represented liabilities exceeding $2.37 billion, as detailed in the memo.
The firms involved include SpaceX, Tesla, Neuralink, The Boring Company, and the AI startup xAI.
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The 44-page document specifies that Tesla is facing $1.19 billion in potential liabilities due to allegations of misleading claims about its autopilot and self-driving features.
Neuralink is implicated with a potential liability of $281 million for allegedly misleading statements regarding the risks associated with its products, according to the memo.
Furthermore, Neuralink could confront penalties totaling $1.59 million for possible violations of the Animal Welfare Act.
The memo suggests a common theme in Musk’s actions appears to be self-interest and a desire to navigate around what he perceives as barriers to his objectives: “The breathtaking scope and scale of benefits Mr. Musk is gaining from his present position may never be fully unveiled, a circumstance seemingly orchestrated.” It posits that this strategic silence could pose risks.
Following the memo’s findings, Sen. Richard Blumenthal of Connecticut, the committee’s ranking member, dispatched letters to five Musk-led companies seeking information regarding the federal inquiries preceding Trump’s inauguration.
CNBC has sought comments from the respective companies.
The letters also demand a summary of the measures each company has implemented to keep Musk’s governmental activities distinct from these investigations. Blumenthal requests responses by May 11.
The White House staunchly refuted any claims suggesting that Musk has utilized his governmental role for “personal or financial gain,” labeling such assertions as “completely false and defamatory.”
White House communications director Steven Cheung criticized Blumenthal, suggesting he is impacted by a “debilitating and uncurable” condition that impairs his judgment.
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