Tesla, Inc. confirmed Tuesday that the Department of Justice (DOJ) is investigating whether the company’s CEO Elon Musk’s comments last month about taking the company private were illegal.
On August 7, Musk tweeted that he had “funding secured” for taking Tesla private at a price of $420 per share. In less than three weeks of posting that tweet, Musk abandoned the plans and said that Tesla would remain a publicly traded company. Since then, Musk has been inundated with lawsuits from shareholders claiming that his earlier comments were deliberately intended to manipulate Tesla’s stock price. The Securities and Exchange Commission (SEC) reportedly started investigating the allegations. But the latest news of the DOJ’s involvement potentially lends a more serious tone to the matter, since the Department’s investigations are often associated with possible criminal charges.