Reuters said the SEC launched the probe in response to a former Tesla employee’s whistleblower complaint that alleged the company failed to properly notify its shareholders and the public of fire risks associated with its solar panel systems. The Reuters report cited communications between the agency and the whistleblower, Steven Henkes, dated Sept. 24.
News of the SEC probe initially sent Tesla shares down as much as 6.4% on Monday. That was more than 20% off their recent 52-week high on Nov. 4, meaning they were in a bear market.
Henkes, who worked as a solar field quality manager for Tesla, filed a whistleblower complaint in 2019. He was fired in 2020 and sued Tesla, alleging he was dismissed in retaliation for raising safety concerns.
The U.S. Consumer Product Safety Commission is also probing the automaker after Henkes filed a complaint with the agency, CNBC previously reported.