Tesla stock investigated secret project

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【Summary】Tesla's stock has seen a resurgence in 2023, but an investigation by the SEC and DOJ into a secret project may put it at risk. The project, known as "Project 42," involved building a house for CEO Elon Musk and raises questions about the misuse of corporate funds. Tesla's stock price remains uncertain as the investigations are in their early stages.

FutureCar Staff Aug 31, 2023 9:17 AM PT

In a surprising turn of events, Tesla's stock has experienced a remarkable resurgence in 2023, overcoming the challenges it faced in the previous year. Among major tech companies, TSLA has emerged as a standout performer, with its stock price more than doubling since the beginning of the year. This impressive revival has captured the attention of investors worldwide.

However, recent reports suggest that Tesla's stock may be facing trouble. On August 30, it was revealed that top US regulators, including the US Securities and Exchange Commission (SEC) and the Department of Justice (DOJ), have launched an investigation into the company over a secret project. The project, internally known as "Project 42," involved the use of corporate funds to build a house for Tesla's CEO, Elon Musk. The SEC and the DOJ are now seeking information regarding the personal benefits Musk received and the amount of money invested in the project.

The existence of "Project 42" was first reported in July when it was discovered that Tesla's board members were looking into whether the company's resources were misused and if Musk was personally involved. The SEC requires public companies to report transactions involving related parties, such as top executives, if they exceed $120,000 and have a material interest.

As investigations are still in their preliminary stages, it is important to note that no formal allegations of wrongdoing have been made against Tesla. The speculative nature of these inquiries underscores the uncertainty surrounding their outcomes. However, the potential for regulatory escalation and legal action, should incriminating evidence arise, adds a note of caution to Tesla's otherwise resurgent stock trajectory.

At the time of writing on August 31, Tesla's shares were valued at $256.90, representing a 0.11% decrease in the past 24 hours. In premarket trading, the stock slipped by a further 0.53% to $255.55. Over the past week, Tesla's share price has risen by more than 12%, but its monthly performance stands at a negative 4%. Despite this, TSLA remains up over 116% year-to-date.

It's worth mentioning that investing in Tesla or any other stocks carries risks, and the content on this site should not be considered investment advice. Always exercise caution when investing, as your capital is at risk.