Tesla’s stock is down 5 percent this morning after news emerged the U.S. Department of Justice had launched a criminal investigation into CEO Elon Musk’s Aug. 7 tweets about taking the company private. The criminal probe is in addition to the previously reported Securities and Exchange Commission investigation into the electric car company.
“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,” a Tesla spokesperson said in a statement provided to TechCrunch. “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 reports that the DOJ’s criminal inquiry is in the “early stages”
“The Justice Department generally does not confirm, deny or otherwise comment on the existence or non-existence of an investigation,” a spokesperson for the DOJ told TechCrunch.
Musk has since retracted those statements, or tweets rather, after speaking with shareholders and investigating the process, realizing the best path forward for the company was to remain public. Here’s an excerpt from his Tesla blog post at the time:
“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. Additionally, a number of institutional shareholders have explained that they have internal compliance issues that limit how much they can invest in a private company. There is also no proven path for most retail investors to own shares if we were private. Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this.'”
The billionaire leader of Tesla and SpaceX wrote at the time that he was considering buying back the company for $82 billion (at a share price of $420 plus debt), and already has the funding to do so. He later disclosed the funding would come from a Saudi Arabian sovereign wealth fund.