Elon Musk mocks SEC less than a week after settling with the agency

Elon Musk insulted the Securities and Exchange Commission days after settling a fraud lawsuit brought by the U.S. agency, potentially imperiling a deal that allows him to remain Tesla Inc.’s chief executive officer.

In a tweet referring to the SEC as “Shortseller Enrichment Commission,” Musk wrote sarcastically that the regulator was “doing incredible work.” An agreement he reached with the agency Saturday -- which isn’t final -- would bar him from serving as chairman for three years as punishment for problematic posts he sent about taking Tesla private.

Tesla shares dropped as much as 3.5 percent to $272 after the close of regular trading. Representatives for the Palo Alto, California-based company didn’t respond to requests for comment. Ryan White, an SEC spokesman, declined to comment.

The post risks putting back in play stiffer forms of punishment that the SEC sought last week, including a prohibition on Musk serving as officer of a public company. The tweet may test the boundaries of an agreement not to deny wrongdoing, and a federal judge still has to decide whether the penalties levied against the CEO are appropriate.

“At the very the least, they can read the riot act to Musk’s lawyer,” said Stephen Crimmins, a former SEC enforcement lawyer who’s now a partner at Murphy & McGovern. “Beyond that, if they feel he hasn’t lived up to his deal, they can theoretically seek to pull the settlement.”