Tesla is facing a criminal investigation by the US Attorney’s Office for the Northern District of California over CEO Elon Musk’s statements about taking Tesla private, Bloomberg reported on Tuesday, citing two people familiar with the matter.
A Tesla representative said the company had received and cooperated with a voluntary request for documents from the Department of Justice but had not received a subpoena.
“Last month, following Elon’s announcement that he was considering taking the company private, Tesla received a voluntary request for documents from the DOJ and has been cooperative in responding to it,” the representative said. “We have not received a subpoena, a request for testimony, or any other formal process. We respect the DOJ’s desire to get information about this and believe that the matter should be quickly resolved as they review the information they have received.”
The US attorney’s office did not immediately respond to a request for comment.
According to Bloomberg, the investigation was opened last month after Musk tweeted that he was considering taking Tesla private and had the “funding secured” to do so. The investigation is in an early stage, one source told the news outlet, and criminal probes do not necessarily lead to enforcement actions.
The Justice Department’s inquiry doesn’t mean it will pursue an extensive investigation, Gregory Sichenzia, a founding partner at the law firm Sichenzia Ross Ference, told Business Insider. He said the department would most likely wait until the Securities and Exchange Commission finishes its investigation into Tesla and review that agency’s findings before deciding whether to escalate its probe.
“Right now, I don’t think it means much of anything,” Sichenzia said of the Justice Department’s inquiry.
Musk attracted controversy in August over his statements about wanting to take Tesla private, raising questions about the certainty of funding and where exactly it would come from.
Subsequent news reports and statements from Musk suggested that he might not have had legally binding agreements in place to finance a go-private deal at the time he published the tweet. Fox Business and The New York Times reported that the SEC had sent subpoenas to Tesla concerning Tesla’s plans to explore going private and Musk’s statements about the process.
The Wall Street Journal reported that the agency had been investigating how the company communicated production issues it faced with its Model 3 sedan before Musk’s tweets about going private.
Two weeks after saying he was considering taking Tesla private, Musk said it would remain a public company. Though he said in a post on Tesla’s website that he believed there was “more than enough funding” to complete a go-private deal, he said the process of going private could create distractions for the company and problems for its current investors, some of whom had told Musk they would prefer Tesla remain public, he said.
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