The SEC drops its four-year-old investigation into EV startup Faraday Future Sean O'Kane 12:50 PM PDT · March 22, 2026 The Securities and Exchange Commission has closed its investigation into electric vehicle startup Faraday Future, despite SEC staff on the case recommending an enforcement action last year, TechCrunch has learned.
Four sources familiar with the investigation, who were granted anonymity to speak about the government case, told TechCrunch that the SEC informed the company and people involved in the probe about the closure this past week.
The dismissal of the case comes amid a historic drop in enforcement actions by the SEC, which only initiated four cases against publicly-traded companies in its 2025 fiscal year, a recent report shows . The SEC did not respond to an after-hours request for comment.
The investigation into Faraday Future lasted for nearly four years. The SEC was looking at whether the EV startup made “false and misleading statements” when it went public in a 2021 merger with a special purpose acquisition company (SPAC), and was also probing whether Faraday Future faked the sales of its first electric vehicles in 2023 — a claim that’s been made by at least three former employee whistleblowers.
The financial regulator sent the startup multiple subpoenas, regulatory filings from Faraday Future show. The SEC also took depositions of multiple former employees and executives in 2024 and 2025, three of the people familiar with the case have told TechCrunch.
In July 2025, Faraday Future revealed the SEC had sent the company and multiple executives — including founder Jia Yueting — letters known as “Wells Notices.” The SEC sends Wells Notices when staff working a case have decided to recommend the agency take enforcement action.
“We can now put all our energy into strategy execution. Over the past five years, we had to spend a great deal of time, effort, and money on cooperating with the investigation,” Jia said in a statement Sunday. Faraday Future said the SEC informed the company that it won’t take action against any of its executives, either.
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The Department of Justice also sent Faraday Future requests for information after the SEC opened its investigation in 2022. Faraday Future has referred to this as an “investigation” in regulatory filings; the DOJ has never confirmed if it opened a full probe, and it did not respond to an after-hours request for comment.
It is rare for the SEC to not pursue an enforcement action after sending a Wells Notice. One study done at the Wharton School in 2020 showed that around 85% of targets who receive a Wells Notice wind up in court with the SEC.
The SEC investigated nearly every electric vehicle startup that went public in a SPAC merger over the last six years. In almost all of those cases, the agency reached a settlement with the startups. It dismissed an investigation into Lucid Motors in 2023, and as TechCrunch first reported in February , the SEC ended a probe into bankrupt EV startup Fisker late last year.
Faraday Future was founded in California in 2014 by Jia, a businessman who at the time was running a booming tech conglomerate in China known as LeEco. It was one of many new companies trying to become the “next Tesla” or, optimistically, a “Tesla killer.”
Faraday snapped up talent from Tesla, other automakers, and also tech companies like Apple, and at one point employed as many as around 1,400 employees. But things got bumpy quickly. The company turned heads, in both good and bad ways, at the 2016 Consumer Electronics Show, with a flashy concept car and the lofty goal of being as disruptive as the iPhone .
The company revealed its first vehicle the following year: a luxury electric SUV called the FF91. By the end of 2017, though the company was nearly out of cash and had laid off or furloughed hundreds of workers . Jia’s company in China had collapsed, and he self-exiled to California as the government in his home country placed him on a debtor blacklist . (It was at this time that a close business associate to Jeffrey Epstein pitched the sex criminal on investing in Faraday Future, as well as other EV startups, as TechCrunch recently revealed . Epstein never invested.)
Faraday Future was rescued by an investment from major Chinese real estate conglomerate Evergrande. But that relationship fell apart quickly, too, with Evergrande walking away by the end of 2018 and Faraday Future laying off even more employees.
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