Elon Musk earned an extra US$156 million (NZ$226m) from his Twitter shares by not disclosing his shareholding when he was supposed to, according to the Washington Post.
The news outlet interviewed legal and securities experts to understand the impact of the controversial billionaire's 9.1 percent purchase of shares in the social media platform.
There are additional complications because the Tesla CEO didn't buy all the shares at one, however.
Instead he spent US$2.64 billion on stock with various purchases between January and April of this year.
Investors are legally obligated to tell the Securities and Exchange Commission (SEC) in the US when they own more than five percent of a company.
Musk reached that milestone on March 14, US time, according to his filing, but only made that disclosure earlier this week. That meant he was 11 days late in declaring his stake.
The entrepreneur was able to buy much of his stock at around US$39 per share - but after his disclosure went public, shares are now trading above US$50.
That earned him an additional US$156 million according to finance professor David Kass.
"I really don't know what's going through his mind. Was he ignorant or knowledgeable that he was violating securities law?" the University of Maryland business school professor said.
It's not the first time Musk has gotten into trouble with the SEC, having previously paid a US$20 million fine for tweeting about Tesla stock. There's also an ongoing legal battle about another SEC subpoena over his selling of 10 percent of Tesla's stock last year.
But legal experts, according to the Post, say the controversial billionaire is most likely to receive just a "slap on the wrist" for failing in his legal duties.
That may run into the hundreds of thousands of dollars, but will be vastly short of the US$156 million that he made.
Adam Pritchard, a professor of securities law, said the SEC could try and argue that the entire theoretical profit should be handed over but they would need to be "really angry with him" to try that.
Pritchard, from University of Michigan's law school, said there was also a good chance that a court would reject it anyway.
Since Musk became the social media platform's biggest shareholder, he's been elevated to the board of directors, drawing criticism from some employees.
Neither Musk nor the SEC replied when asked for comments, the Post reported.