The U.S. securities regulator has opened an investigation into Tesla Inc over a whistleblower complaint.
A letter from the agency has it that the whistleblower had complained that the company failed to properly notify its shareholders and the public of fire risks associated with solar panel system defects over several years.
Concerns about fires from Tesla solar systems have been published previously, but this is the first report of investigation by the securities regulator.
The U.S. Securities and Exchange Commission disclosed the Tesla probe in response to a Freedom of Information Act request by Steven Henkes, a former Tesla field quality manager, who filed a whistleblower complaint on the solar systems in 2019 and asked the agency for information about the report.
In the SEC complaint, Henkes said Tesla and SolarCity, which it acquired in 2016, did not disclose its “liability and exposure to property damage, risk of injury of users, fire etc to shareholders” prior and after the acquisition.
Tesla also failed to notify its customers that defective electrical connectors could lead to fires, according to the complaint.
Henkes, in the SEC complaint, said he told Tesla management that Tesla needs to shut down the fire-prone solar systems, report to safety regulators and notify consumers. When his calls were ignored, he proceeded to file complaints with regulators.