Car Industry

Tesla under Justice Department investigation, report says

The investigation reportedly focuses on Musk's claim of "funding secured" to take the company private.

Elon Musk and his company are once again reportedly in hot water with the feds.

Joshua Lott/Getty Images

Shortly after Elon Musk's infamous "funding secured" tweet, in which he said he was considering taking Tesla private, the Securities and Exchange Commission was reportedly investigating those claims. Now, a bigger fish has reportedly bitten down on the same hook.

Tesla is currently under investigation by the Justice Department, Bloomberg reports, citing "two people familiar with the matter." A spokesperson for the US attorney's office in San Francisco declined to comment. 

In an emailed statement, Tesla admits that the Justice Department has asked them for documents and that the company is cooperating. "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," the statement says. "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." 

Bloomberg's sources said that the probe is in its early stages, and this comment would seem to back that claim up.

According to Bloomberg's sources, the criminal probe, like the alleged SEC investigation before it, was opened after Musk tweeted that he had secured funding to take his electric-car company private at the price of $420 per share. This criminal probe is reportedly running alongside the SEC's investigation, which is reportedly still ongoing. Neither Tesla nor the SEC confirmed that investigation when the news first broke.

In August, Musk tweeted his intention to take the company private. In a subsequent blog post, Musk claimed that he wanted to take Tesla private to focus on long-term goals instead of short-term earnings reports, but he welcomed all current public shareholders to stay on as private investors. Rumors flew about who exactly was involved in providing the tens of billions of dollars that could be required in such a move, but before anything could be confirmed, Musk switched positions and decided to keep the company public.

Update, 4:11 p.m. PT: Added that the Justice Department declined to comment.