Tesla faces an investigation by the US government for allegedly misusing its funds for "Project 42," a secret project that may entail constructing Elon Musk's mansion. The Southern District of New York US Attorney's Office is investigating.
The probe seeks information on Elon Musk's benefits, the secret project's expenditures, and its purpose. The SEC, the US financial authority, is investigating the covert effort civilly, The Guardian reported.
Authorities Demand Transparency
According to reports from July, "Project 42" designs showed a striking twisted hexagonal structure placed on riverfront land close to Tesla's Austin facility in Texas. They resembled the famous Apple store at Fifth Avenue in Manhattan. According to insider sources, Elon Musk would live in the planned building.
One feature of the project that attracted notice was a large glass box that was included in the design, which led to suspicion that it may have featured a residential component. When it was discovered that a substantial multimillion-dollar order for specialist glass had been made as part of Project 42's development, concerns arose inside the electric car manufacturing firm.
Read Also: Forever 21 Data Breach: Personal Details of Over 500,000 Customers, Employees Compromised
Insider reported that this instruction sparked an internal investigation against Tesla executive Omead Afshar, who ran the Texas facility. According to reports, federal prosecutors are looking for internal correspondence about Afshar's participation in making purchases of building supplies. The Tesla official has yet to comment on the controversy.
Tesla's Mounting Woes
The Tesla board reportedly also looked into how much Elon Musk was involved in the project and how much money was spent on it. A July Wall Street Journal report indicated that the SEC requires disclosure for transactions above $120,000 where executives have a significant stake, and any personal advantages over $10,000 must be disclosed to investors. Potential charges have not been verified as investigations are still in their early stages.
Along with "Project 42," federal prosecutors are investigating Tesla's electric car range. According to Engadget, questions have been raised regarding the company's procedures in the wake of a Reuters inquiry claiming that Tesla's electric vehicles routinely fall short of range predictions. The electric vehicle maker reportedly created a dedicated crew to handle repair appointments involving concerns about the driving range.
These inquiries highlight the increased emphasis on financial and operational openness inside the firm and the mounting scrutiny Tesla and its CEO, Elon Musk, must address.
Related Article: X Ends Ban on Political Ads But Will Continue Some Restrictions
