The FBI is conducting a criminal investigation into whether Tesla misstated production figures about the electric auto maker's Model 3 sedan and misled investors about its business, according to a published report.
Any emphasis on Tesla's past explanations about Model 3 production targets would expand the probe by the agency, which Tesla said a month ago was taking a look at proclamations made by Chief Executive Elon Musk about a go-private deal that was later cancelled.
A criminal investigation into Tesla handled by the US attorney's office in San Francisco has reportedly intensified in recent weeks following Tesla and Elon Musk's settlement with the SEC, according to sources.
"When we started the Model 3 production ramp, we were transparent about how hard it would be", the representative continued. However, only 2,700 Model 3 vehicles were produced throughout 2017 due to miscalculations and production delays.
The Justice Department inquiry reportedly stems from Tesla's claims of its ability to produce the Model 3 at volume in 2017.
Musk promised investors that Tesla would make 5,000 Model 3s per week to keep his legion of critics at bay.
The automaker told Reuters that it has not received a subpoena from the Department of Justice related to Model 3 production, but rather has cooperated with a voluntary request for documents.
After bungling its first production targets, Tesla lowered the expectations, but not enough to actually be able to meet them.
According to Ars Technica, Tesla is being investigated by the Federal Bureau of Investigation regarding the production of their Model 3 vehicles and their alleged misleading of investors.
While Tesla tries to shake up the industry, long-established automaker Ford Motor Co. reported a net profit decline of 37 percent in the third quarter as sales slowed in the USA and China.
Both Tesla and Musk must pay a $20 million fine, and Musk must give up his chairman role for three years as the company appoints an independent chair. Kallo, who has a bullish $US411 price target for the stock, added that "investigators would need to find evidence TSLA made projections it knew would be impossible to achieve, which we believe is a high bar to meet". Earlier, another Twitter user charged that the substance and timing of the Journal's article was "purely meant to distort [Tesla's] stock and harm investors" and questioned why the SEC wasn't looking into it.