Following the announcement that the FBI is investigating Elon Musk’s Tesla over alleged false claims relating to vehicle production numbers, Wall Street analysts and other experts hold mixed opinions on the FBI’s case.
Breitbart News published an article recently which stated that agents from the FBI are investigating whether or not Tesla misstated information about the production of its Model 3 sedans, misleading investors in the process. The FBI is reportedly looking back at evidence and production figures starting from early 2017 according to people familiar with the situation.
But now, Wall Street analysts have reportedly become skeptical about whether or not the FBI’s case against Tesla will stick. Ben Kallo, an analyst at Baird, said in a note to clients: “We think it will be difficult for prosecutors to prove criminal wrongdoing,” adding “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.” Kallo further stated that he found the initial report from the Wall Street Journal used “largely recycled previously reported information,” and that he found “certain aspects of the article suspect.”
Ross Gerber of the Los Angeles firm Gerber Kawasaki, also questioned the article stating in a tweet: “You’ve got to wonder how much the media is being manipulated by Tesla shorts. Of course as the stock breaks out they release some BS WSJ article. Mid day. Not questionable at all.”
However, others claim that the investigation into Tesla is not being taken seriously enough, such as former SEC Chairman Harvey Pitt, who discussed the investigation in a recent interview on Fox Business stating: “It poses a very serious threat both to Mr. Musk personally and to the company as an organization and I think that people should be taking it more seriously.”
Harvey Pitt on SEC investigation into Elon Musk: "It poses a very serious threat both to Mr. Musk personally and to the company as an organization and I think that people should be taking it more seriously." pic.twitter.com/NUPdSXOVNl
— FOX Business (@FoxBusiness) October 29, 2018
Tesla stock currently trades at $334.85 a share.