In House - The FindLaw Corporate Counsel Blog

3 Ways to Fly Below Regulatory Radar

Flying below the radar could be a risky thing.

Literally, it means that your aircraft could be be flying low enough to hit buildings. The trade-off is to fly lower than radar can detect and avoid anti-aircraft fire.

Figuratively, that's the goal for many businesses that want to avoid regulatory entanglement. Here are some ways to avoid the risks.

Don't Smoke Pot

Tesla and its CEO Elon Musk are good examples. With the project of revolutionizing electric cars, they are constantly drawing attention.

That's not a good thing when it comes to government regulators. Publicly held companies shouldn't throttle down innovation, but they shouldn't publicly break laws either.

Musk seems to have done it at least three times in the past year. Smoking pot on a podcast was the least of his infractions, but investors have smoke detectors and they didn't like it.

Don't Predict the Future

Musk predicted last year that his company would produce 5,000 Model 3 cars per week by now. That hasn't happened.

What has happened is that investors are upset. Some think Musk misled them.

The Federal Bureau of Investigation is looking into it. Oh yeah, the FBI has radar, too.

Don't Fake Tweet

While Musk has enjoyed great financial success, he has also lost more money in nine words than anybody: "Am considering taking Tesla private at $420. Funding secured."

That blipped hard on the screen at the Securities and Exchange Commission. The SEC never would have known if Musk had kept his tweets to himself.

About $40 million in fines later, Tesla and Musk are back in the driver's seat. Well, not literally. Musk had to give up his position as chairman of Tesla's board.

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