Tesla reveals SEC subpoenas as Musk calls reports of deepening FBI probe 'absurd'

Drew Harwell, The Washington Post

Published

11:23 am PDT, Friday, November 2, 2018

Federal securities regulators have issued subpoenas regarding Tesla's public insurances on the production of its newest car, the company said Friday, the latest signal of an aggressive aggressive investigation into Elon Musk's electric automaker.

Tesla filed with the Securities and Exchange Commission on Friday, confirms that the SEC has issued subpoenas as part of a deepening probe into the company's projections for its Model 3 sedan last year. These numbers have been widely considered as a make-or-break issue, as they have been sought to navigate chaos, slow down, and prove to investors that it could survive.

The Justice Department has also requested documents as part of a similar investigation, but these investigators have not issued subpoenas or made other formal requests, Tesla said in a statement Friday. Tesla 's SEC filing said that it' s enforcement action, cash flow and future prospects.

Tesla and Musk, its billionaire chief executive, have been pushed back into the Wall Street Journal report last week that the FBI was pursuing a deepening criminal investigation into Tesla. Recode released Friday morning, Musk called the report "utterly false," "absurd" and written by reporters who are "terrible people."

SEC officials did not respond to requests for comment. The FBI declined.

News of the SEC 's subpoenas comes a few weeks after Musk settled with the agency on a second inquiry into his claim that he would take Tesla private. The tweet, which Musk later said was a joke, caused the company to fall 14 percent. The SEC has a lawsuit that has made Muslims and Tesla and Musk agreed last month to $ 20 million and have Musk step down as chairman of the board.

The expanding SEC has been established in the last decade of the past, and has finally been resurfaced in the marketplace. defending against any government action.

The $ 58 trillion company agreed on the part of the SEC to be closer to Musk's social-media commentary. But in the days after the settlement, Musk taunted the agency, tweeting, "Just want to [say] that the Shortseller Enrichment Commission is doing incredible work. "

The probe, led by SEC investigators in San Francisco, touches on questions that have been raised by Tesla investors and train employees of the company having truthfully conveyed its progress in producing its futuristic, battery-powered cars.

To form Tesla employee, Martin Tripp, sought whistleblower protection and filed SEC claims claiming that Musk had overstated production numbers, which Tesla has disputed. Shareholders made similar claims in a securities-fraud lawsuit dismissed in August by a federal judge.

Unconventional factory methods and failures at Silicon Valley automaker forced to endure months of costly delays and executive departures at its factory in Fremont, Calif., During a time that Musk has called "production hell." The company said Friday that it is expected to spend up to $ 6 billion on factories and equipment through 2020.

"When we started the Model 3 production ramp, we were transparent about how difficult it would be," the company said in a statement. "While Tesla gets criticized when it is delayed in reaching a goal, it should not be forgotten that Tesla has achieved many goals that have been made more difficult by this. getting us to volume production. "

Musk put it a different way in his Recode interview: "It is absurd that Tesla is alive, Absurd, Absurd."

– – –

The Washington Post's Matt Zapotosky contributed to this report.