The Justice Department is reportedly investigating Elon Musk for fraud over tweets that suggested he would take Tesla private. He later backtracked on that plan.
The Justice Department is investigating Elon Musk for fraud over tweets that suggested he would take Tesla private, according to Bloomberg, which cited «two people familiar with the matter.»
At issue is an Aug. 7 tweet from the Tesla CEO that said he was «considering taking Tesla private at $420» and asserted that he’d secured funding for the move. «Shareholders could either to sell at 420 or hold shares & go private,» he wrote in a follow-up tweet.
At the time, it was unclear if Musk was joking or not, given 420’s association with cannabis culture. But his tweet prompted a stock price increase.
Am considering taking Tesla private at $420. Funding secured.
More than two weeks later, Musk announced that he had decided against going private. «Given the feedback I’ve received, it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company,» he wrote on Aug. 24.
Furthermore, going private would be too «time-consuming and distracting,» he said, especially amidst the demands of Model 3 production .
Tesla confirmed to Bloomberg that it «received a voluntary request for documents from the DOJ [last month] and has been cooperative in responding to it.»
According to Bloomberg, the DOJ probe will run «alongside a previously reported civil inquiry by securities regulators,» which is investigating whether Tesla misled investors with announcements about manufacturing and sales goals.
It’s far from the only headache for Musk, who is also CEO of SpaceX. CNBC reports that the US Air Force is mulling how best to respond to Musk’s appearance on the Joe Rogan podcast, where he smoked marijuana. While recreational marijuana use is legal in California, where the podcast was recorded, you’re not supposed to use it if you have a government security clearance, which «Musk may have because of the contracts SpaceX has with the Air Force,» CBNC says.
Musk was also sued for libel by Vernon Unsworth, a British cave diver who helped rescue the 12 Thai teenagers trapped in a flooded cave. Without citing any evidence, Musk branded Unsworth a «pedo» after Unsworth criticized Musk’s contributions, or lack thereof, to the cave rescue. It perhaps would have stopped there, but Musk then questioned why Unsworth had not filed suit, and Unsworth called his (possible) bluff.
Speaking to BuzzFeed News, Musk suggested that the publication should «call people you know in Thailand, find out what’s actually going on and stop defending child rapists, you fucking asshole,» again without providing any evidence to back up his claim.
Unsworth seeks $75,000 in compensation and an injunction against Musk.
