Tesla Inc (TSLA) Refuses To Disclose Details Of SEC Investigation

Regulators have looked into whether Tesla Inc (NASDAQ:TSLA) is being honest about its Model 3 production and delivery process, and neither side is talking.

The Detroit News has more details on the interesting development:

The Securities and Exchange Commission investigated Tesla over how it was selling its Model 3 sedan, but the company didn’t tell investors about it, and may still be under federal investigation, according to a new report.
The firm led by CEO Elon Musk was under investigation by the securities regulator from June 2016 to May 2017, according to SEC documents.
Tesla did not respond to a request for comment.

Specifically, the SEC was looking into whether Tesla’s policy of taking $1,000 deposits for the cars were done in good faith or not. Ultimately the investigation ended without any action being taken, although there’s reason to believe another probe is taking place.

Perhaps most tellingly, Tesla won’t disclose to investors what exactly the SEC is looking into. Instead, it continues to focus on fanning the flames of hype surrounding the vehicle, hoping to get as many people as possible to plunk down a $1,000 deposit, which it then uses to fund its manufacturing process.

That’s all well and good as long as buyers are clearly aware of the waiting times, and if Tesla is being honest about potential delays. Multiple investigations into the issue seem to indicate that regulators believe Tesla may not be acting in good faith, however.

Tesla Inc shares closed at $343.45 on Friday, up $5.56 (+1.65%). Year-to-date, TSLA has gained 60.72%, versus a 20.93% rise in the benchmark S&P 500 index during the same period.

TSLA currently has a StockNews.com POWR Rating of B (Buy), and is ranked #12 of 24 stocks in the Auto & Vehicle Manufacturers category.

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