Elon Musk’s August 7 tweet that he had “funding secured” to take Tesla private has become the subject of a criminal investigation by the Justice Department, Bloomberg reports, citing two anonymous sources. The involvement of the Justice Department would be significant because the Securities and Exchange Commission—which has been investigating the case for several weeks—only has the power to bring civil charges.
Tesla’s share price dropped by about 6 percent in the minutes after Bloomberg reported the news.
While Musk’s initial tweet claimed he had “funding secured” to buy out existing shareholders, he soon admitted he didn’t actually have anything in writing. Days before the tweet, he had a meeting with Saudi Arabia’s sovereign wealth fund and emerged from the meeting convinced that the Saudis would be willing to fund a deal.
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