Tesla Is Reportedly Being Investigated For Possible Securities Law Breach

2012-2016 Tesla Model S 1 photo
Photo: Tesla
Tesla Motors has reportedly got under the watchful eye of the Securities and Exchange Commission, all because of the fatal accident involving a Model S that was driving with Autopilot.
While not officially confirmed by the Securities and Exchange Commission and denied by the automaker, Tesla Motors is reportedly being investigated by the SEC over a potential breach of securities law.

The unnamed source who disclosed this information claims it happened because the company did not notify investors of the fatal accident involving the Autopilot system, which was active at the time of impact.

The information mentioned above comes from a source who contacted the Wall Street Journal, the publication that was the first to report this investigation.

Meanwhile, a spokesperson from Tesla Motors explained to CNBC that the company has yet to receive any communication from the Securities and Exchange Commission regarding the information presented by the Wall Street Journal. This is not the first time when Tesla is under fire because of the accident that occurred on May 7, 2016, and it may not be the last.

The claimed SEC investigation of Tesla Motors is maybe linked to a $2 billion offering of Tesla stock on May 18, 2016. Some accused the automaker of intentionally not disclosing the accident to investors, so that it would achieve a better financial position on its $2 billion offering in Tesla stock on May 18, 11 days after the fatal incident.

On the other hand, Tesla Motors has explained it considered the accident was “not material to the value of Tesla,” and reminded everyone that a car maker does not have to notify investors of every or any fatal accident that occurs in one of its models.

Moreover, Tesla says its investigators did not get the chance to recover the complete logs until May 18, when they inspected the car and the crash site. Tesla says it completed its investigation in late May.

Once an article was published in Fortune Magazine, Tesla replied with a post on its official blog, where they called the piece “misleading,” and “fundamentally incorrect.”

We must note that Tesla representatives claim that they were been contacted during the 4th of July holiday and requested a day to comment the matter thoroughly, but the article was rushed to print before company spokespersons managed to reply.
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About the author: Sebastian Toma
Sebastian Toma profile photo

Sebastian's love for cars began at a young age. Little did he know that a career would emerge from this passion (and that it would not, sadly, involve being a professional racecar driver). In over fourteen years, he got behind the wheel of several hundred vehicles and in the offices of the most important car publications in his homeland.
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