All the Press: Tesla the Target of Criminal Probe, Report Claims
What a week it’s shaping up to be for Tesla CEO Elon Musk. Interestingly, if this latest report proves true, we can pin the blame for all of Musk’s misfortune over the past 24 hours on the presence of social media, and his tendency to overuse it.
According to Bloomberg, the U.S. Justice Department has opened a fraud investigation into Musk’s infamous “funding secured” tweet — the online message that kicked off a strange journey that ultimately went nowhere.
The August 7th tweet, in which Musk said there was funding secured to finance his go-private plan, was sent from Musk’s car as he drove to work, the sleep-deprived CEO later admitted. But funding was not secure, and follow-up tweets and blog posts failed to provide details on where the billions needed to take the company private would come from. Musk also reportedly pissed off the Saudis after revealing the nature of talks between his company and Saudi Arabia’s Public Investment Fund.
As confusion grew and investors became angrier, Tesla’s stock slowly sank, accelerating in that direction after the U.S. Securities and Exchange Commission got involved and Musk pulled a U-turn on the entire plan. By the end of the month, Musk had assembled banks and advisors to hunt down the money he originally claimed was secured.
This DOJ probe, reportedly occurring concurrently with the SEC’s investigation, seeks to examine if Musk broke the law with the nature and contents of the tweet, two sources told Bloomberg. Just yesterday, Musk’s Twitter shenanigans landed him a libel suit from a British cave explorer.
Tesla’s stock, hammered by the events of the past month, sank a further 5 percent after news of the DOJ probe broke.
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