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Tesla Says Justice Department, SEC Are Investigating Model 3 Production Targets (cnbc.com)
Tesla said in a regulatory filing Friday that the SEC and Justice Department are investigating their Model 3 production projections to see if they misled investors. CNBC reports: The filing confirms much of an Oct. 26 article in The Wall Street Journal that said FBI agents were looking at whether Tesla misled investors about production of its Model 3 sedans. The FBI is the principal investigative arm of the Justice Department. The SEC, which just settled its securities fraud investigation against CEO Elon Musk and the company, has separately subpoenaed Tesla for Musk's statements about production rates regarding its popular Model 3 sedan, the company said. DOJ prosecutors have also asked for the same information, although it stopped short of issuing a formal subpoena, the company said in a filing with the SEC. In an interview with Recode's Kara Swisher, Elon Musk denied the validity of the WSJ article.
"The amount of untruthful stuff that is written is unbelievable. Take that Wall Street Journal front-page article about, like, 'The FBI is closing in.' That is utterly false. That's absurd," Musk told Swisher. "To print such a falsehood on the front page of a major newspaper is outrageous. Like, why are they even journalists? They're terrible. Terrible people."
"The amount of untruthful stuff that is written is unbelievable. Take that Wall Street Journal front-page article about, like, 'The FBI is closing in.' That is utterly false. That's absurd," Musk told Swisher. "To print such a falsehood on the front page of a major newspaper is outrageous. Like, why are they even journalists? They're terrible. Terrible people."
Is this just more Trump hating on Musk because Trump is a short deller, anti-tech, pro-GW, felon, Orange, going to jail, and no EVs in federal prison?
I miss anything?
Bloomberg and their stupid "china spyware chips are everywhere" bullshit story, WSJ trying to make Tesla fail... it's like the media is being controlled by idiots who believe technology is evil.
Next up, newspapers publishing that coal is clean, nuclear is a gift from satan himself and space travel is impossible because the earth is all that exists in the universe.
#DeleteFacebook
Were they merely overly optimistic then or were criminally misleading? Since almost all the production woes were quite public. Tesla has said many times it was betting the company. Its behavior in early 2018 can actually shows it was just overly optimistic.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
As I understand it, the problem under investigation is not "Tesla forecast they'd make X many but only made Y". Failure to predict the future is not illegal, and even being overly optimistic in your shareholder forecasts isn't a crime. As long as they weren't egregiously bullshitting when they made that public, they'd be good.
The area under investigation is the actual production numbers. Tesla shorts have latched onto a pretty bonkers theory that Tesla was somehow falsifying their production numbers - fake VINs, or delivering known-defective vehicles to count them as "delivered" even though they'd need to be replaced. Some of it is quibbling over the definition of "delivered" - is something sent to a dealer counted as a "delivery" or does that only count when someone buys it? - made worse by Tesla not using independent-ish dealerships, but rather their own stores.
I personally don't think there's a case here. Musk makes schedules he can't keep, and promises features he can't deliver, but he really doesn't lie about accomplishments. Especially not ones that are so easily verified - the FBI will have a pretty easy time finding out if VINs are being misallocated, so the investigation should be pretty short.
The Wall St report came last week and stopped a good momentum, but the stock recovered very soon. This disclosure came early today during trading hours, and the stock barely budged. Looks like whatever it is, it has been fully priced into the stock.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Not to age myself, but was that written by, like, a 'valley girl?"
"National Security is the chief cause of national insecurity." - Celine's First Law
To print such a falsehood on the front page of a major newspaper is outrageous. Like, why are they even journalists? They're terrible. Terrible people."
Welcome to Trump's world.
5 out of 6 people enjoy Russian Roulette & 6 out of 7 Dwarfs are not Happy
So, Fake News?
"National Security is the chief cause of national insecurity." - Celine's First Law
There are two things driving this:
1. Musk very publicly gave the SEC the middle finger. Bureaucrats in the US may not have all encompassing power but they do have the power to make your life difficult. If you screw with them they're going to screw right back. And frankly, I kind of don't blame them in this case, messing with people's portfolios to impress your girlfriend and give her a good laugh (the 420/privatization tweet) is not how you run a public business (see my note below).
2. There are a lot of people who shorted Telsa hoping they'd screw up the Telsa 3 and they lost. Now they're desperate to drive the price down and throwing up all manner of stupid conspiracy theories. My favorite is pictures of "staging" lots full of Telsa 3's being put up as proof that no one is actually buying them... never-mind the fact that this is an industry standard practice because none of them drive the car from the assembly line to your door. They stage for bulk transport. Queue the slighted bureaucrats who know this is horse-sh*t but it's a convenient excuse to screw with Musk.
That aside, Tesla should be taken private. Musk has a "grand vision" and that doesn't work with the stock market as it exists today. Decades ago you bought stock and held onto it because you were actually investing in a company. The current model is companies have to deliver profits every quarter, you buy into a stock to get the bump and you buy out. That's not investing... it's arbitrage. Musk needs to free himself from that crap.
somehow falsifying their production numbers - fake VINs, or delivering known-defective vehicles to count them as "delivered" even though they'd need to be replaced.
That reminds me of when Miniscribe shipped 26,000 bricks in disk drive boxes. Good times.
In a post truth world, smart people realize that data, and facts are not used to establish truth. One first decides what truth they accept (usually determined by where they were born) Then the data and facts you need to support your truth are loudly proclaimed, and everyone who disagrees with their cherry picked data is called either a communist, a science denier, or a nazi depending on which side of arbitrary truth line they have decided to align themselves.
Point is we can in no way know whether Tesla is good or evil, or even if it is a car company. They only thing we can know for certain is that someone with power and access to the media has a problem with Tesla and want the FBI to investigate them.
Get over it Musk, suicide cults run the World.
Just more "Slashdot's typical terrible coverage".
The criticism of the WSJ article was that it recycled old information and presented it as new. The fact that there had been a DOJ investigation was not news; Tesla confirmed a Bloomberg story on it in September. The request for documents from Tesla happened over a month ago. WSJ made this big front-page "DOJ is closing in!" article based on the fact that... the FBI sought documents and testimony from some former employees. It caused the stock price to plunge, but by the end of the day it had almost fully recovered (and surged past that the next day) as investors realized that they were just recycling a story. Then after the 10-Q repeated the news that broke in, I'll repeat, September (that the DOJ had requested, and been given, documents related to the production ramp), a number of outlets ran prominently with the exact "Tesla confirms DOJ investigation!" article, as if this was actual, new news. They're milking the heck out of this.
FYI: the DOJ case was launched simultaneously with a civil case on the exact same issue. Tesla already won the civil case. Obviously. Seriously: if missing projections while publicly describing what's going on as "production hell" is actionable, then virtually every company in the United States would be bankrupt.
Nobody pushes buttons like our bunny. Big red buttons with labels that say "IGNITION", apparently.
He should have taken it private about 1-2 years ago. Now, Tesla has the cash flow that is needed. Combine that with MY and the semi coming in 2019, and cash flow along with profits, will likely go up 2-4x. I will say, I find it sad that so many Americans want him to fail for their own personal gain, while in Europe, china, Australia, India, etc they are begging Tesla to come there.
I prefer the "u" in honour as it seems to be missing these days.
I'd think that the FBI is investigating more than just "missing projected targets", perhaps evidence of actually misleading the public. If your internal studies predict a 3500 a week production volume by Q4 and you promise 5000 a week by Q2, then that could be construed as misleading, legally speaking.
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
Only if management actually believes said study. At any large organization, there will exist some people people who believe that any given schedule is too optimistic, and will say so. To argue that because some people in an organization expressed concern about a schedule, but management overruled them, that this is criminally actionable, would be to argue that almost any delayed project where anyone protested is actionable. What matters is whether the decision makers believed their own schedules. Aka, the case would be to argue that Musk has no record of excessive optimism about schedules.
Yeah, good luck with that. We're talking about a guy who literally just the other day just fired his Starlink managers because he felt their schedules were too pessimistic.
Nobody pushes buttons like our bunny. Big red buttons with labels that say "IGNITION", apparently.
Tantrums don't make you smart, and neither does marketing.
The issue is that Musk made statements about production issues at Tesla that may not have been true. Similar to the "funding secured" claim that got him fined $20M and put on a leash by the SEC.
Public companies have to be very careful about statements they make regarding things like production because people then make investment decisions based on them, and they must be truthful. It looks like Musk was baited by short sellers into making statements that were, shall we say, "optimistic" at best.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
"misleading the public" is not a crime, and the FBI doesn't investigate it. Keep trying, Ivan, you'll figure it out eventually.
We're talking about a guy who literally just the other day just fired his Starlink managers because he felt their schedules were too pessimistic.
The reporting I saw said that they were not being pessimistic, they were being insubordinate and continued to insist on additional testing after being told not to.
It matters a lot to understanding that situation to consider that that is the only project in the history of satellites where they're sending so many up that they're happy to just shove the first few dozen of a design up early and do a live test. Individually they're not very important. None of these managers has ever experienced that in their career, and they're not likely to ever experience it again on another job. So it makes sense that they would refuse to violate what is normally a non-negotiable standard of certainty. OTOH, it is totally understandable to fire them, too.
Only if management actually believes said study. At any large organization, there will exist some people people who believe that any given schedule is too optimistic, and will say so. To argue that because some people in an organization expressed concern about a schedule, but management overruled them, that this is criminally actionable, would be to argue that almost any delayed project where anyone protested is actionable. What matters is whether the decision makers believed their own schedules. Aka, the case would be to argue that Musk has no record of excessive optimism about schedules.
Yeah, good luck with that. We're talking about a guy who literally just the other day just fired his Starlink managers because he felt their schedules were too pessimistic.
It's very simple: Have they delivered the cars or not?
It shouldn't take more than 10 minutes to investigate that, which is why I don't believe this story is anything more than YAEMSC paid for by the competition.
(Yet Another Elon Musk Smear Campaign).
No sig today...
Is there a single salesman ever who hasn't mislead the customers?
Even the first used-brontosaurus salesmen were at it.
No sig today...
Well according to the quote from Tesla here:
In particular, the SEC has issued subpoenas to Tesla in connection with (a) Mr. Musk's prior statement that he was considering taking Tesla private and (b) certain projections that we made for Model 3 production rates during 2017 and other public statements relating to Model 3 production.
Good thing Musk never makes "aspirational" targets. Oh, wait...
Failure to predict the future is not illegal (...) As long as they weren't egregiously bullshitting
Predicting a future you aren't actually planning for can be illegal. Like if you're planning to open a new plant in six months you can't claim it's opening next quarter and then announce a three month delay later. If a machine is capacity limited to 3000 cars/week and you're not doing anything about it you can't project to make 5000/week. If you're not actually planning to pay shifts to work 24x7 you can't use that in your calculations. I think Musk is quite capable of padding the estimates beyond the "most optimistic projection" as a stretch goal. And normally I don't think anyone would bother, but now he's got the SEC pissed and looking for ways to throw the book at him.
That whole "going private" business only meant something to the people who bought/sold stock in that period, if you were sitting on it throughout it was just a paper valuation. If the SEC can show Musk misled all the investors through fraudulent production projections, now that could get nasty. Still seems rather unlikely but considering how poorly he seems to understand his obligations as a CEO of a public company, who knows. He doesn't seem to have any understanding of why we made rules about misleading public investors.
Live today, because you never know what tomorrow brings
The second report about subpoena came yesterday during market hours. Again it seems to be recycling some 10-K filing done in September. This time market did not budge much.
The S3 partners is reporting that the number of Tesla shorted shares has come down a little. But because of the price increase the value of shorted shares spiked making Tesla most shorted shares again for a while. S3 does not think the shorts have been squeezed, and there is no forced covering of shorts. The big players are ignoring the paper loss, and girding down for a longer fight.
There was a shortage of shares that could be borrowed, down to almost a few thousand shares and the cost of keeping a short position open was seven times more expensive for TSLA shorts than other securities a while back. S3 says it has eased now and 16 to 20 million shares are now available for borrowing. So the cost of keeping the short position open for another quarter is not much for the big ones.
Some long time shorts are exiting. A second one (not the Left of Citron, another one) announced "Tesla short is no longer the bankruptcy live or die short thesis. It is now merely a valuation too high short thesis. So I am out".
Soon "Tesla is going to die" stories will stop generating clicks and these click-bait "journalists" also will go away.
This is my theory, which is quite mild compared to most fanboi conspiracy theories: The timing of WSJ stories suggest it is well connected small time shorts with good connections, who ride along the big players, who are "persuading" friendly journalists to plant stories so that they can exit.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
We're entering an era where journalists not only lie through their teeth to smear political opponents, they also routinely engage in blackmail to knock people off the internet and even take tens off thousands of dollars away from charities just because they don't like people.
A bullet may have your name on it but splash damage is addressed "To whom it may concern."
It states: "Aside from the settlement with the SEC relating to Mr. Musk’s statement that he was considering taking Tesla private, there have not been any developments in these matters that we deem to be material, and to our knowledge no government agency in any ongoing investigation has concluded that any wrongdoing occurred."
Let's focus on the fact that the Tesla Model 3 best selling car by revenue in the US!
Still seems rather unlikely but considering how poorly he seems to understand his obligations as a CEO of a public company, who knows. He doesn't seem to have any understanding of why we made rules about misleading public investors.
If he's been lying all along, he deserves what he gets. But it doesn't actually seem so. We'll see.
What's ironic about this is that Musk is considerably more open and informative than most other CEOs in a similar position, which is a great benefit to the small investor IMHO.
Case in point, the whole going private thing started because he thought he ought to tell the small investors about it too, and not just have private conversations with a few big ones.
It is when it's about production targets and volumes which directly relate to revenue and profit of a company. Then it's considered fraud...
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
Nope, that isn't considered fraud at all, otherwise there would be lots more arrests for it.
In fact, this is nothing more than a government witch hunt as it attacks one of its opponents. Ironically, an immigrant putting Americans to work.
When people point out he's lying, Trump says it's fake news, and the journalists are terrible people. He sure is good at drumming up publicity though, getting people talking. One way Trump does that is saying it's going to be huge. The biggest ever.
When the major papers (and regulators) point out Musk was lying, he says it's fake news and the journalists are "terrible people, just terrible". Musk sure is good at drumming up publicity though, getting people talking. One way Musk does that is saying whatever he's doing is going to be huge, the biggest ever. With 0.01% of the auto market, he's convinced a *lot* of people that his tiny little boutique car maker will be the largest auto manufacturer in the world any day now.
Musk *is* Trump. If you look on the bottom of their foot, you'll see they are both the same model number, cast from the same mold.
There is little doubt that Elon Musk is a maniac. But he is a driven maniac, and his auto company probably would not exist if not for his monomaniacal drive and promotion of it. There has been an entirely disproportionate amount of activity in the media over some questionable actions that may have affected the stock price at a relatively small company -- Tesla. I have no doubt that this is being driven at least partly by labor union interests, who have been desperately trying to unionize the Tesla factories for several years, and failing at it. And the media, now the most active arm of the Democrat party, is helping the unions in their activism.
we get virtually all our information tech from an extremely aggressive and authoritarian regime. That's not up for debate. It's just a fact. We probably should keep a close eye on that.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
'Funding secured.' That is utterly false. That's absurd," SEC told Musk. "To state such a falsehood on a public platform is outrageous. Like, why is he even a CEO? He's terrible. Terrible person."
I find it sad that so many Americans want him to fail for their own personal gain
I find it sad that you're faking ownership of a Tesla Model S to appear you're not just a Musk cocksucker.
If I owned a MS I'd be more active on teslamotorsclub.com than a grand total of three posts at the time of your registration one year ago.
And why are you posting at 03:16AM in the morning in your home state of Colorado?
It's not about misleading the management but about misleading the investors.
About who owns the media and financial regulators
Is Tesla a salesman? Is Elon a salesman? Both arent? Then wtf are you talking about?oh yea, another Tesla shill throwing out strawman.
Look over here folks.
Don't the OTHER investors who are shorting Tesla and promoting the bad news have any responsibility to not mislead other investors? Let's stick to examples where incorrect information was being disseminated. It's not justice if they get to do that while the company (any company) is liable for... a missed production target. Does Tesla vote for the government or something? If investors don't like it they should sell.
Like, why are they even journalists? They're terrible. Terrible people.
Careful there, Elon. You're starting to sound like Trump.
So, a CEO coming out and publicly stating they are building 30% more cars than they really are, and stating that sales are 50% more than expected, even though they have data which disputes the very claims, is not guilty of fraud and stock manipulation? CEOs and companies are fined when they mislead investors by overstating estimated revenues or understating risks.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
The lawsuit alleging that stuff about the production numbers was already dismissed. It was fucking stupid, and lacks the details you'd need to believe in something like that; like what is the actual accusation? It is hand-waving that includes percentages of affected vehicles, but no reason for that percentage, and no idea what it is a percentage of; as if cars can't easily be counted, or something.
Automobiles are not a virtual resource. They are very countable.
You're exceptionally credulous, but only depending on your feelies about the people involved.
So then why is Tesla saying that they are being investigated about claimed production numbers? Remember, this isn't a media outlet claiming, this is Tesla stating the investigation in their own filings. Or do we say this is nothing, like Musk's tweet about going private, that ended up getting him canned from the role of Chairman, adding two new independent board members, and fining Tesla and Musk $20MM each?
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
Seems like Musk has been found out, and it turns out he is nothing more than a snake oil salesman.
I don't know about you, but I've been on many projects (Fortune 500 company here) where engineering told management that it would take X months to complete it, and management came back with a schedule of X/2. That's not evidence of misleading the public in any legal sense of the word. That's management telling engineering, to make it happen. Sometimes it works, sometimes it's bullshit. The question is, did Tesla come anywhere close to the publicly stated goals...I don't know for certain, but thought I'd read elsewhere that they had.
Just another day in Paradise
A ten second google would have told you that your statement is misleading the public...and a crime.
https://en.wikipedia.org/wiki/...
Just another day in Paradise
No. No it would not.
Instead of making a strong claim where you don't actually know the answer, you could have just asked me instead.
And in fact, that is an exceptionally stupid thing to burp up on your shirt. That law is about lying to federal agents, like the FBI. It doesn't cover things you said to the public! LMFAO
From your link:
It applies to criminal investigations, such as false statements made in response to an inquiry by an FBI or other Federal agent, or made voluntarily to an agent.
I don't know what country you're from, but nothing Tesla puts into its filings could come afoul of that law. And certainly, nothing I say could be prosecuted under that! You're a complete idiot if you think Americans don't have freeze peach. We have freeze peach all day long dumb fuck.