• Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla
  • Image Credit: Tesla

Tesla was under investigation by the Securities and Exchange Commission for a year over how it was selling its Model 3 sedan, yet the maker of electric vehicles never told investors about it, according to a report. The company may still be under a separate SEC investigation.

The independent website Probes Reporter, which focuses on public companies' interactions with the SEC, published 15 pages of legal documents it obtained from the federal agency via a Freedom of Information Act request. They show that the SEC investigated Tesla from June 2016 through May 2017 and ended the probe without any enforcement action. Yet Probes Reporter says the SEC blocked it from accessing other records on Tesla on law enforcement grounds, which it says suggests "there is at least one other unresolved SEC probe" into Tesla.

The investigation stems from the timing of a May 18, 2016, report from Goldman Sachs analysts upgrading Tesla on the same day the investment bank joined Morgan Stanley in underwriting a $2 billion Tesla stock offering. The SEC documents obtained by Probes Reporter mostly focus on Tesla, however, saying that the company "may have been or may be making false statements of material fact or failing to disclose material facts concerning the Company's Model 3 vehicle." The SEC ordered the company to turn over documents related to Model 3 cancellations and deposits, among other things.

Tesla has taken $1,000 deposits for the Model 3, its $35,000 electric sedan, as a way to generate cash flow as it ramps up production. It made no mention of the investigation in its most recent quarterly earnings report, when it announced it was delaying production targets of the Model 3 by three months. Tesla hasn't commented on reports of the investigation. The company only recently has begun delivering the car to non-employee customers.

"To us, there's more than enough here to conclude this investigation should have been disclosed by Tesla," Probes Reporter writes. "Investor focus on the Model 3 has been intense this past year, with Elon and his crew fanning the flames. With this backdrop, we think investors most certainly would consider an SEC probe that asked a lot of questions about the Model 3 to be material and, therefore, would have wanted to know about it."

It continued: "At any time, Tesla could stop playing Disclosure Games with investors, become more transparent, and simple let time prove them right. Instead, this team continues to act like the rules (on many fronts) don't apply to them."

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