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Musk “falsely indicated that, should he so choose, it was virtually certain that he could take Tesla private at a purchase price that reflected a substantial premium over Tesla stock’s then-current share price” and “that funding for this multi-billion dollar transaction had been secured,” the SEC charged. “In truth and in fact, Musk had not even discussed, much less confirmed, key deal terms, including price, with any potential funding source.”

\"Musk’s false and misleading public statements and omissions caused significant confusion and disruption in the market for Tesla’s stock and resulting harm to investors,\" the SEC said in its suit, adding that Musk engaged in \"manipulative and deceptive practices.\"

Tesla shares plunged four percent before closing 0.67 percent lower at $307.52 on Thursday. It was down 11.08 percent at $272.45 in after-hours trading.

“Corporate officers hold positions of trust in our markets and have important responsibilities to shareholders,” said Steven Peikin, co-director of the SEC’s Enforcement Division. “An officer’s celebrity status or reputation as a technological innovator does not give license to take those responsibilities lightly.”

Late Thursday, Tesla's board of directors released a joint statement in support of Musk that read:

\"Tesla and the board of directors are fully confident in Elon, his integrity, and his leadership of the company, which has resulted in the most successful US auto company in over a century. Our focus remains on the continued ramp of Model 3 production and delivering for our customers, shareholders and employees.\"

ABC News' Aaron Katersky contributed to this report.

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