Tesla stock under scrutiny amid investigation into undisclosed project

author: FutureCar Staff    

In a surprising twist, Tesla's stock has experienced a remarkable comeback in 2023, overcoming the challenges it faced in the previous year. Despite a difficult 2022, TSLA has emerged as a standout performer among major tech companies, 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 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 US Attorney's Office for the Southern District of New York has requested information about the personal benefits Musk received from the project, as well as the amount of money Tesla invested in it and its purpose. The SEC, which requires public companies to report transactions involving related parties, is also leading a civil investigation into the matter.

Initial reports about "Project 42" emerged in July, when it was revealed that Tesla's board members had looked into whether the company's resources were misused on this secret venture and whether Musk was personally involved. The project involved the construction of a large glass structure in the Austin, Texas area, but the current status of the endeavor and whether the glass was ever delivered to Tesla remains unknown.

As of August 31, Tesla's stock was priced at $256.90, showing a slight decrease of 0.11% 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 jumped more than 12%, but its monthly performance sits at a negative 4%. Despite this, the stock remains up over 116% year-to-date.

It is important to note that the investigations into Tesla are still in their preliminary stages, and the outcomes are uncertain. No formal allegations of wrongdoing have been made yet, highlighting the speculative nature of these inquiries. However, the possibility of regulatory escalation and legal action, should incriminating evidence emerge, adds a sense of caution to Tesla's otherwise resurgent stock trajectory.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative, and there is a risk of capital loss.

FutureCar Staff