Tesla faces U.S. criminal probe over self-driving claims, sources say

Tesla is under criminal investigation in the United States over claims that the company’s electric vehicles can drive themselves, three people familiar with the matter said.

The U.S. Department of Justice launched the previously undisclosed investigation last year after more than a dozen crashes, some of them fatal, involving Tesla’s Autopilot driver assistance system, which was activated during the accidents, the people said.

Back in 2016, Tesla’s marketing materials touted Autopilot’s capabilities. During a conference that year, Elon Musk, the chief executive of the Silicon Valley automaker, described it as “probably better” than a human driver.

Last week, Musk said in another call, Tesla will soon release an updated version of “Full Self-Driving” software allowing customers to travel “to your work, your friend’s house, to the grocery store without you touching the wheel.”

A video currently on the company’s website says: “The person in the driver’s seat is only there for legal reasons. He doesn’t do anything. The car drives itself.”

However, the company also explicitly warned drivers that they should keep their hands on the wheel and maintain control of their vehicles when using Autopilot.

The Tesla technology is designed to help with steering, braking, speed and lane changes but its features “do not make the vehicle autonomous,” the company says on its website.

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Such warnings could complicate any case the Justice Department might want to bring, the sources said.

Tesla, which disbanded its media department in 2020, did not respond to written questions from Reuters on Wednesday. Musk also did not respond to written questions seeking comment. A Justice Department spokesman declined to comment.

Musk said in an interview with Automotive News in 2020 that Autopilot problems stem from customers using the system contrary to Tesla’s instructions.

Federal and California safety regulators are already examining whether claims about Autopilot’s capabilities and the system’s design imbue customers with a false sense of security, encouraging them to treat Teslas as truly driverless cars and become complacent behind the wheel with potentially fatal consequences.

The Justice Department investigation may represent a more serious level of scrutiny because of the possibility of criminal charges against the company or individual executives, people familiar with the investigation said.

As part of the latest investigation, Justice Department prosecutors in Washington and San Francisco are examining whether Tesla misled consumers, investors and regulators by making unsupported claims about the capabilities of its driver-assistance technology, the sources said.

Officials conducting their investigation could ultimately pursue criminal charges, seek civil sanctions or close the investigation without taking any action, they said.

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The Justice Department’s Autopilot investigation is far from recommending any action in part because it competes with two other DOJ investigations involving Tesla, one of the sources said. Investigators still have a lot of work to do and no decision on charges is imminent, this source said.

The Justice Department may also face challenges in building its case, the sources said, given Tesla’s warnings about over-reliance on Autopilot.

For example, after telling the investor call last week that Teslas will soon travel without customers touching controls, Musk added that the vehicles still need someone in the driver’s seat. “Like we don’t say that’s all set to have nobody behind the wheel,” he said.

Tesla’s website also warns that before enabling Autopilot, the driver must first agree to “keep your hands on the steering wheel at all times” and always “maintain control and responsibility for your vehicle.”

Barbara McQuade, a former U.S. attorney in Detroit who has prosecuted auto companies and employees in fraud cases and is not involved in the current investigation, said investigators will likely have to uncover evidence such as emails or other internal communications showing Tesla and Musk made misleading statements. . on the capabilities of Autopilot on purpose.

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Several Probes

The Autopilot criminal investigation adds to the other investigations and legal problems involving Musk, who was locked in a legal battle earlier this year after abandoning a $44 billion takeover of social media giant Twitter Inc, only to reverse course and announce excitement for the looming acquisition.

In August 2021, the US National Highway Traffic Safety Administration opened an investigation into a series of crashes, one of them fatal, involving Autopilot-equipped Teslas crashing into parked emergency vehicles.

NHTSA officials in June stepped up their investigation, which covers 830,000 Teslas with Autopilot, identifying 16 crashes involving the company’s electric cars and stationary response and roadside maintenance vehicles. The move is a step regulators must take before requesting a recall. The agency had no immediate comment.

In July of this year, the California Department of Motor Vehicles accused Tesla of falsely advertising its Autopilot and Full Self-Driving capabilities as providing autonomous vehicle control. Tesla has filed paperwork with the agency seeking a hearing on the allegations and has indicated it intends to defend against them. The DMV said in a statement that it is currently in the discovery stage of the proceeding and declined further comment.

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