Tesla: No Subpoena from Justice Department — Yet

FBI interview former employees about Model 3 production.

by on Oct.26, 2018

The FBI is interviewing former Tesla employees about Model 3 production. Tesla officials say no company officials have been subpoenaed.

Tesla Inc. and CEO Elon Musk may have resolved their issues with the Securities and Exchange Commission, but an ongoing criminal investigation by the Department of Justice appears to be motoring along in high gear.

The company told the Wall Street Journal that it hasn’t been subpoenaed by the DoJ regarding potentially fraudulent claims made by Musk and the company about the Model 3.

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Officials at the Palo Alto, California-based EV maker say they cooperated with what they described as a “voluntary request” for documents from the Justice Department in September, a Tesla spokesperson told Reuters. 

“We have not received a subpoena, a request for testimony, or any other formal process, and there have been no additional document requests about this from the Department of Justice for months,” the spokesperson said in an email.

(Tesla says company is focusing on what’s next. Click Here for the story.)

Tesla officials claim they have been nothing but up front about Model 3 production — and the delays.

The Federal Bureau of Investigation is examining whether Tesla incorrectly stated information about production of its Model 3 sedans, misleading investors in the process, as far back as early 2017, the Wall Street Journal reported.

FBI agents have been interviewing former Tesla employees, in some cases using subpoenas to compel them to submit to interviews.

Tesla revealed last month the DoJ was investigating Musk’s tweets about having “funding secured” for a deal to take Tesla private, saying the agency had asked for documents about such statements. It was ultimately determined that Musk did not actually have a plan in place but had only cursory discussions about the possibility with potential investors.

(Click Here for more about Tesla bucking analysts predictions, turning a profit.)

The SEC fined Tesla $20 million for the claim and fined Musk $20 million and ordered him to remove himself as Chairman of the company for three years. He was ordered to do so within 45 days of the decision. He has less than 30 days to get that accomplished and has been unwilling to discuss publicly how that process is going.

The Model 3 is the focus of a Department of Justice criminal probe of Tesla.

The growing FBI probe comes on the heels of Musk happily reporting the company turning a profit for the third quarter, largely due to the Model 3. The company produced more than 56,000 Model 3 sedans during Q3.

In addition to the profit, Tesla reported positive cash flow, making good on pledges made by Musk earlier this year, as the company ramps up production volume of the Model 3. Musk told analysts and reporters on the earnings call that he expects the company to profitable every quarter going forward.

(To see more about Tesla meeting its Q3 production goal, Click Here.) 

The company also faces a class-action suit from investors claiming the company made fraudulent claims about Model 3 production. Musk and the company refute the claims, citing several examples of Musk complaining about the difficulty of getting Model 3 production on track.

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2 Responses to “Tesla: No Subpoena from Justice Department — Yet”

  1. Allen says:

    Anything new on the whistleblower and union actions?

    • Paul A. Eisenstein says:

      Nothing of yet, Allen.