Tesla, along with its Chief Executive Elon Musk, is under investigation for using company funding for Musk’s personal benefit, according to a new Wall Street Journal report.
The Manhattan divisions of the Department of Justice and the Securities and Exchange Commission are seeking to determine whether Tesla diverted funding to a mysterious “Project 42,” believed internally to be a new glass house in Texas for Musk.
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Citing people familiar with the issue, the Wall Street Journal reports that the US Attorney’s Office for the Southern District of New York subpoenaed current and former Tesla employees in an effort to determine the extent of the funding committed to the project, which called for the construction of a lavish glass home in Austin, Texas.
The SEC similarly announced a civil investigation into Project 42, though both probes are still in their early stages and may not lead to formal charges. But if funds from the publicly-traded company are found to have been spent on an executive’s private project, it could warrant an IRS investigation and lead to shareholder lawsuits.
The Journal previously reported in July that an internal probe by the Tesla board was unable to specify the level of funding or Musk’s personal involvement in the project. However, it was reported at the time that specialized glass was scheduled to be delivered as part of a construction project near the company’s gigafactory in Austin.
At this time, is unclear whether construction is still in the works or if the glass was ever delivered to the intended site.
Neither Musk nor the US Attorney’s office has issued a public statement regarding the investigation.
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