Lordstown Motors Faces Justice Department Probe
It's been a tumultuous year so far for the electric vehicle maker
What happens when a company’s compelling narrative comes under a growing amount of scrutiny? That’s been the case for Lordstown Motors, the GM-backed startup that announced ambitious plans for an American-made electric truck, the Endurance. Earlier this year, research released by a firm with a short position in Lordstown Motors suggested the startup was less of a success story than many people believed. In the days that followed, the company’s CEO and CFO both resigned.
This week brings news of another potential setback for Lordstown Motors — namely, an inquiry from the Justice Department. At Engadget, I. Bonifacic cites a recent Wall Street Journal report and notes that this follows an existing inquiry from the SEC.
“It’s unclear what the DOJ is examining, but the US Attorney’s office leading the investigation often handles fraud allegations,” Bonifacic writes. Lordstown Motors has announced that it is cooperating with both investigations.
The Wall Street Journal article, by Ben Foldy and Rebecca Davis O’Brien, contains more details — including that the SEC’s investigation focuses on “Lordstown Motors’ move last year to become a public company and its representations about preorders.”
In a statement to The Verge, Lordstown Motors spoke of wanting to address these issues and move forward. “We look forward to closing this chapter so that our new leadership – and entire dedicated team – can focus solely on producing the first and best full-size all-electric pickup truck, the Lordstown Endurance,” said a company spokesperson.
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