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U.S. Department of Justice report investigates securities and wire fraud

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Top line

A criminal investigation into Tesla’s claims that its semi-automated vehicles are self-driving is focusing on possible securities and wire fraud charges related to concerns that the company and its CEO Elon Musk overstated their cars’ self-driving capabilities, according to a new report from Reuters.

Important facts

The electric car manufacturer has been under investigation since 2021, as Reuters reported at the time. The reason for this was a series of accidents that occurred while Tesla’s partially automated driving system was activated. Subpoenas on various topics.

The investigation reportedly focused on Tesla’s claims and marketing of the car’s automation capabilities – its automation systems are called “Autopilot” and “Full Self-Driving,” for example, which has drawn scrutiny from regulators and other groups that claim This falsely suggests that cars are autonomous and do not require human supervision to operate.

Over the years, both Musk and Tesla have praised the cars’ “self-driving” capabilities – for example, a video on Tesla’s website claims that “the person in the driver’s seat is only there for legal reasons” and “the car is “drives himself” – although Reuters reported that it was not immediately clear which specific statements might be subject to criminal scrutiny.

Although the vehicles can perform many tasks automatically, they still require human supervision and driver attention, as well as the ability to keep their hands on the steering wheel.

When investigating wire fraud and securities fraud, investigators must prove that Tesla distributed fraudulent communications to consumers and that the company deceived investors, Reuters reported.

Forbes has reached out to the Justice Department and Tesla for comment.

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Cons

While Musk and Tesla are optimistic about Tesla’s capabilities, they have also made other statements acknowledging the importance of human intervention in their “self-driving” vehicles. For example, Tesla’s website notes that the Autopilot features “require active supervision from the driver and do not make the vehicle autonomous.” A post on X from Tesla described the Full Self Driving system as “FSD Supervised” on Tuesday and musk also bolstered the program, writing, “Tesla’s latest version of (monitored) self-driving will blow your mind.” Reuters reported that DOJ sources believe potential charges based on these claims could face significant legal hurdles in court.

Important background

Tesla’s partial automation technology has come under scrutiny on several fronts. According to the Washington Post, at least eight lawsuits have been filed involving fatal or serious accidents, alleging the technology was unsafe and that the company overstated its capabilities. In December, the company had to recall over 2 million cars due to concerns about its Autopilot technology. The National Highway Traffic Safety Administration said this week that it is seeking more information about the recall amid concerns the automaker did not do enough to ensure drivers remained alert after 20 crashes following the software update in December were reported. The Insurance Institute for Highway Safety gave its first safety ratings to various partially automated driving systems in March, giving nearly all of them poor safety ratings, including Tesla’s.

Big number

13. This is how many fatal accidents involving Tesla’s Autopilot feature were identified by the National Highway Traffic Safety Administration in an investigation that began in 2021.

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