Turns out Musk may need to tell investors about crashes BEFORE selling them $2B in stock
The Securities and Exchange comission is investigating Tesla for a possible breach in securities laws, because they didn’t disclose the May 7 fatal Autopilot crash to investors at the time of the tragic incident.
Citing a person familiar with the matter, The Wall Street Journal reported the SEC is looking into whether the crash should be considered a “material” event that an investor would want to know about.
Tesla has said the company “has not received any communication from the SEC regarding this issue,” claiming a recent company blog post “provided the relevant information about this issue.”
Elon Musk and Tesla ended up selling about $2 billion in stock on May 18 and 19, well after the Model S crash, but didn’t disclose news of the accident until June 30 — the same day that the National Highway Traffic Safety Administration announced they will be investigating the crash.
The Journal also reports the SEC is at the very beginning of its probe, so news on any conclusions could be a long ways off.
The May 7 crash happened in a Model S while it was on Autopilot. Tesla and Musk have responded defensively since news of the crash broke, with blog posts trying to make the case that Tesla’s Autopilot system is safer than normal driving and tweets from Musk attacking media outlets for their reporting of the issue.