Elon Musk has not had a good couple of days. Just yesterday he was being sued by a cave diver for calling him 'pedo guy' and now the CEO's electric car company, Tesla, is reportedly under investigation by the Justice Department for fraud.
According to Bloomberg, sources claim the criminal probe is running alongside a civil investigation opened last month after Musk tweeted that he was considering taking Tesla private and that he had "funding secured" for the deal.
The innovator then backpedalled, later stating that the deal fell through and the company would remain public. Although as reported by Bloomberg, the initial tweet sent its shares higher and now it looks like the Department of Justice is getting involved.
Advert
Tesla wrote in a statement: "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.
"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."
Even before the whole tweet debacle, Tesla was already under investigation by SEC enforcement attorneys in the San Francisco office who were looking into whether Musk misled investors and breached federal securities laws with his statements. In other words, they were sniffing about to see if there were any signs of fraud.
But now that the Department of Justice is involved, this takes it from a civil matter to a criminal one and that has led to a plummet in Tesla's stock by about 20 points.
Advert
As reported by Futurist, there's been some recent movement back up the scale, but it's still not even close to the $420 per share price that got Tesla into this mess to begin with.
However, we're still not 100% on whether the SEC investigation is linked to the Department of Justice one - either way, Musk and his company Tesla are under the spotlight right now and things are heating up fast. Keep your ears to the ground for more on this to come.
Featured Image Credit: PATopics: tesla, elon musk, Tweets, US News, Twitter, Fraud