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Tesla Stock Slides On Report of SEC Probe Into Whistleblower Complaints Linked To Solar Panel Risks

Reuters reported Monday that the SEC is looking into allegations from a former employee that it failed to properly communicate risks linked to fire risks in its solar panels.

Tesla  (TSLA) - Get Tesla Inc Report shares moved lower Monday following reports that the Securities and Exchange Commission has opened a probe into the clean-energy carmaker linked to whistleblower claims of defects in its solar panels.

Reuters reported Monday that the SEC's Division of Enforcement is looking into allegations that the group's Tesla Energy subsidiary failed to properly notify shareholders of the risks linked to its solar panel systems, which it acquired though the $2.6 billion purchase of SolarCity in 2016.

The report said former Tesla employee Steven Henkes unveiled the probe through a Freedom of Information request in late September. Henkes, who was fired in August of 2020, filed a wrongful termination suit against Tesla Energy in a California court last year.  

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Earlier this year, the U.S. Consumer Product Safety Commission began an investigation into complaints from Henkes -- filed in the spring of 2019 -- into how the carmaker communicated fire risks linked to its solar panels.

Tesla shares were marked 3.75% lower in late-morning trading Monday to change hands at $977.2 each.

Founder and CEO Elon Musk was sued by some of the company's biggest shareholders in Delaware earlier this year amid allegations Musk improperly influenced the board to approve the SolarCity takeover.

Musk said earlier this summer that Tesla has a backlog of 80,000 orders, valued at more than $500 million, for its Powerwall home solar-energy-storage system. 

Musk added, however, that it can't ramp-up production to meet demand due to the global chip shortage.