*By Hope King* The only way Tesla can get out of its conundrum is to show that CEO Elon Musk did have funding secured at the time he posted his show-stopping tweet, according to former SEC Chair Laura Unger. "It was not true and accurate, according to everything I've read and seen, that he had financing secured at that time," Unger told Cheddar on Thursday afternoon. "That was quite a big overstatement ー 'financing secured' ー and it was one that was clearly misleading to the marketplace." Unger, who was sworn in as a Commissioner of the SEC in 1997 and served as Acting Chairman in 2001, said Musk's intentions to take the company private may be there, but the blog post he published Monday was not "very satisfactory" as an explanation of his plans. "Confession might be a little strong," Unger said, referring to a term used by Will Chamberlain, a plaintiff in one of the class action suits against Tesla. [Chamberlain joined Cheddar Monday](https://cheddar.com/videos/tesla-short-seller-calls-musks-blog-post-a-confession) a few hours after Musk's post published. His suit was [filed last Friday](https://cheddar.com/videos/class-action-lawsuit-filed-against-tesla-after-elon-musks-tweet) and alleges that “manipulative acts" resulted in "a short squeeze that drove the price of Tesla shares to artificially high levels.” Prior to his interview, Chamberlain said he covered his short positions (80 percent common stock, 20 percents puts) because he had to take the tweet seriously. The tweet said "funding" was "secured" and that Musk wanting to take the company private at $420 is reasonable. The NASDAQ halted trading for about an hour and a half last Tuesday, and the stock closed up 11 percent. Musk is the "CEO of a publicly traded company," Chamberlain said. "I have to hedge against the risk that he has not committed securities fraud. That seems like a reasonable thing to do." Unger said the tweet brings up another important question: Musk's state of mind. "Even if he didn't intend to manipulate the market or to mislead investors, if he was reckless in knowing or not knowing that \[the tweet\] would have caused people to buy or sell securities based on that information ... then that would be sufficient to show his state of mind," Unger said. And if that's the case, the most severe action the SEC could take would be to bar him from acting as an officer or director of a public company. "He's probably wishing right now that he was the CEO of a private company and that that date can't come too soon," Unger said. "But unfortunately he's not." For more on this story, [click here](https://cheddar.com/videos/climate-change-brings-devastating-heat-wave).
