The U.S. Justice Department has opened a criminal investigation over Tesla chief executive Elon Musk’s ‘going private’ tweet, according to Bloomberg News, adding to a civil inquiry and causing shares to fall.
Sources told Bloomberg on Tuesday that federal prosecutors opened a fraud investigation after Musk said in a tweet that he was considering to take the company private. He claimed that funding had already been secured.
Tesla shares dropped in the wake of Tuesday’s news and were down nearly 5 percent at 12:20 p.m. ET. There was no immediate comment from Musk, Tesla or the U.S. Justice Department.
“Am considering taking Tesla private at $420. Funding secured,” Musk said in a tweet on August 7.
The tweet caused Tesla shares to rise, but on August 24 he backed off the idea. “My belief that there is more than enough funding to take Tesla private was reinforced during this process,” Musk said at the time.
The matter is also being investigated by the U.S. Securities and Exchange Commission (SEC), which served Tesla with a subpoena in August, according to the New York Times.
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