Senators Call for DOJ Probe of X's Advertiser Pressure Campaign -- Update

Dow Jones
03-07

By Suzanne Vranica

Five Democratic senators have asked the Justice Department to investigate whether Elon Musk is leveraging his influence in the Trump administration to bully advertisers into returning to X.

The request, from Sens. Elizabeth Warren, Cory Booker, Richard Blumenthal, Adam Schiff and Chris Van Hollen, follows a Wall Street Journal report last month about the social-media platform's pressuring Interpublic Group to spend more on X.

If Musk uses his government position to harm those who don't do business with him, "he risks running afoul of criminal ethics laws," the senators wrote to Attorney General Pam Bondi in a letter, a copy of which was viewed by the Journal.

The senators wrote that they are concerned X is taking advantage of Musk's powerful role to "extract revenue from advertisers."

The Journal reported last month that an attorney at X encouraged the advertising conglomerate Interpublic to increase its spending on X or face consequences. Interpublic executives interpreted the communication as a threat that its pending $13 billion merger with rival Omnicom Group could be negatively affected by the Trump administration, given Musk's government role, the Journal reported. The Federal Trade Commission is conducting an initial review of the deal.

X didn't immediately respond to a request for comment about the senators' letters, and didn't previously comment on the Interpublic allegations.

Musk is leading the Department of Government Efficiency and is a regular presence in the White House alongside President Trump. Musk bought Twitter, now known as X, in late 2022.

"At President Trump's direction, Elon Musk and DOGE are saving historic amounts of taxpayer money from being spent on unserious bureaucratic pet projects -- it comes as no surprise that Democrats are upset with him," a Justice Department spokesman said in a written statement.

Advertisers began fleeing X shortly after Musk's $44 billion takeover. Brands were alarmed by his promise to loosen content-moderation restrictions, fearing their ads might appear alongside controversial content that could damage their reputations. Additionally, advertisers were concerned about upheaval in the company's executive ranks. Controversy over antisemitic content on X in 2023 caused even more brands to pull back.

The letter, dated Wednesday, said that as a " Special Government Employee," Musk is subject to federal ethics laws, including a prohibition on bribery.

In a separate letter seen by the Journal, the senators urged FTC Chairman Andrew N. Ferguson and Omeed Assefi, who oversees the Justice Department's antitrust division, to resist any pressure from Musk or X to block the Interpublic-Omnicom merger.

Musk's government role and ownership of X and other businesses create a "significant conflict of interest," they said in that Wednesday letter. "The apparent attempt to strong-arm the federal government to advance his business dealings could violate federal ethics laws and, depending on the specific facts, the federal extortion statute," they wrote.

The senators said they took no position on the merger itself. Interpublic recently signed a new annual deal with X for potential client spending, the Journal previously reported. A flurry of brands have returned to or are beginning to increase their spending on X, including Amazon, Apple and Verizon.

Write to Suzanne Vranica at Suzanne.Vranica@wsj.com

 

(END) Dow Jones Newswires

March 06, 2025 14:46 ET (19:46 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.

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