Bloomberg – US regulators are investigating the role of Elon Musk about information about Tesla’s self-driving cars (TSLA), in the latest effort by authorities to investigate the actions of the second richest man in the world.
The audit is part of an ongoing investigation by the U.S. Securities and Exchange Commission into the company’s disclosures about its Autopilot driver assistance system, according to a person familiar with the matter. Bloomberg who did not want to be identified, discussing aspects of the investigation that were not made public.
As Tesla’s CEO, the veracity of Musk’s comments carries special weight under agency rules. The SEC declined to comment. Musk and his attorney Alex Spiro did not respond to requests for comment.
Musk already differs from the SEC on many fronts. But the Autopilot investigation directly touches on a business priority that Musk has stressed is critical to Tesla’s future.
SEC officials are evaluating whether Musk may have misrepresented the system’s promises, the person said. Investigations by the agency’s enforcement unit do not always yield results, but they can result in prosecutions, fines or other civil penalties for companies and executives.
It was not possible to determine exactly which of Musk’s statements or activities regarding the self-driving car drew the SEC’s attention.
Tesla’s driver assistance technology has been a focus of Musk’s for years. He personally directed the creation of a 2016 video that may have exceeded the capabilities of technology. The video’s promises of fully autonomous driving performance have ultimately not been fulfilled.
In a behind-the-scenes shot of Musk’s thoughts on the Autopilot video, he told Tesla employees in internal emails in 2016, “I’m going to tell the world that this is what the car *can* do.” Musk continued, “not that I can do that after receiving.”
Tesla is beating its competitors in self-driving cars because “the car can be freely improved,” Musk said during a conversation on Twitter Spaces in December. “This is something that no other car manufacturer can do,” he added.
Separately, Tesla is also facing scrutiny by safety authorities over its self-driving systems and is poised for its first court case over a driver death linked to Autopilot.
The US Department of Justice is also investigating whether the electric car maker’s public comments about the feature were misleading.
The US National Highway Traffic Safety Administration has two investigations underway into whether the automatics are malfunctioning. The agency updated the first — focused on how Tesla Autopilot handles car crash scenarios — in June of last year. He started another investigation – about the sudden stop – four months earlier.
Tesla’s CEO has been battling the SEC for years over the disappearance from his infamous tweet that he had secured financing to take Tesla private.
He pleaded guilty in 2018 this week in a San Francisco court, where investors alleged he committed securities fraud. Musk said he believed at the time that he had financial backing from wealthy investors and the Saudi government.
Tesla shares rose 11% on Friday, extending their gain this year to 44% amid hopes that the worst is over for the electric car maker. The stock has fallen 65% in the past year, partly fueled by concerns that Musk will be distracted by his Twitter acquisition. Musk is worth $155.7 billion, according to the Bloomberg Billionaires Index.
— Featuring Dana Hull, Malathi Nayak, Craig Trudell, Stephanie Stoughton and Joe Schneider.
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