Report: SEC Probes Tesla Over Crash Disclosure


The Securities and Exchange Commission is investigating whether Tesla Motors broke the law by failing to disclose a deadly accident to investors in a timely manner, according to The Wall Street Journal.

On May 7, Tesla owner Joshua Brown was killed when his car—operating in Autopilot mode—collided with a tractor-trailer truck on a Florida highway.

The fatality was first reported to the public on June 30, after the National Highway Traffic Safety Administration had begun what Tesla called "a preliminary evaluation to determine whether the system worked according to expectations."

But the company's failure to disclose the crash to investors in a securities filing has the SEC on its tail. An inquiry, according to an anonymous Journal source, is still in the early stages, and may not lead to regulatory action.

The SEC declined to comment. A Tesla spokeswoman told PCMag that the company "has not received any communication from the SEC regarding this issue."

Instead, she pointed to last week's blog post, in which Tesla fired back at Fortune's recent allegations that it purposefully withheld material information from shareholders.

"Fortune entirely ignores what Tesla knew and when, nor have they even asked the questions," the post said. "Instead, they simply assumed that Tesla has complete information from the moment this accident occured. This was a physical impossibility given that the damage sustained by the Model S in the crash limited Tesla's ability to recover data from it remotely."

Tesla also claimed its Autopilot system was not at fault for the collision.

Meanwhile, reports indicate that the NHTSA is investigating a second, nonfatal crash involving a Tesla operating in autonomous mode.

Autopilot functionality rolled out in October via a software update. But the $2,500 optional add-on is still in beta testing, and Tesla urges drivers to keep their hands on the steering wheel while using it.

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