The Securities and Exchange Commission has concluded its inquiry into electric vehicle startup Faraday Future, even though SEC personnel involved in the matter had suggested an enforcement action last year, according to TechCrunch.

Four individuals knowledgeable about the investigation, who requested anonymity to discuss the government matter, informed TechCrunch that the SEC communicated the case’s closure to the company and those implicated in the review this past week.

The case’s dismissal occurs amid a historic decline in the SEC’s enforcement actions, with only four cases initiated against publicly traded firms in its 2025 fiscal year, a recent report indicates. The SEC did not reply to a request for comments submitted after business hours.

The inquiry into Faraday Future spanned almost four years. The SEC was assessing whether the EV startup provided “false and misleading statements” during its 2021 public listing via a merger with a special purpose acquisition company (SPAC) and whether the company misrepresented the sales of its initial electric vehicles in 2023 — allegations made by at least three former employee whistleblowers.

The financial regulator issued several subpoenas to the startup, as documented in regulatory filings from Faraday Future. Additionally, the SEC conducted depositions of multiple former staff and executives in 2024 and 2025, three individuals informed TechCrunch.

In July 2025, Faraday Future disclosed that the SEC had sent the company and several executives — including founder Jia Yueting — letters termed “Wells Notices.” The SEC issues Wells Notices when its staff has opted to recommend enforcement action to the agency.

“We can redirect all our focus towards executing our strategy. Over the last five years, we devoted considerable time, effort, and resources to cooperating with the investigation,” Jia stated in a release on Sunday. Faraday Future indicated that the SEC had informed the company it would not pursue action against any of its executives, either.

It remains unclear if Faraday Future ever addressed the Wells Notices sent the previous year. As recently as February, the company revealed in regulatory filings that it had not. “The Company and executives intend to engage with the SEC to clarify why enforcement action should not be pursued,” Faraday Future communicated in a filing last month.

The Department of Justice also issued requests for information to Faraday Future following the SEC’s initiation of its inquiry in 2022. Faraday Future has characterized this as an “investigation” in regulatory filings; the DOJ has never confirmed whether it commenced a full investigation and did not respond to an after-hours request for comment.

It is uncommon for the SEC to avoid pursuing enforcement action after sending a Wells Notice. A study conducted at the Wharton School in 2020 indicated that approximately 85% of targets receiving a Wells Notice ultimately face court proceedings with the SEC.

The SEC scrutinized nearly every electric vehicle startup that went public in a SPAC merger throughout the past six years. In nearly all instances, the agency reached settlements with the startups. It dismissed an investigation involving Lucid Motors in 2023, and as reported by TechCrunch in February, the SEC concluded a probe into the bankrupt EV startup Fisker late last year.

Origins of the investigation

Faraday Future was established in California in 2014 by Jia, a businessman who was then managing a flourishing tech conglomerate in China called LeEco. It was one of numerous nascent companies attempting to become the “next Tesla” or, in an optimistic view, a “Tesla killer.”

Faraday attracted talent from Tesla, various automakers, and tech companies like Apple, and at one time employed approximately 1,400 workers. However, challenges arose swiftly. The company garnered attention, both positive and negative, at the 2016 Consumer Electronics Show with a spectacular concept vehicle and the ambitious aim of being as revolutionary as the iPhone.

The company showcased its inaugural vehicle the following year: a high-end electric SUV named the FF91. By the close of 2017, however, the company was nearly out of funds and had laid off or furloughed hundreds of employees. Jia’s company in China collapsed, and he self-exiled to California as the government in his homeland placed him on a debtor blacklist. (During this period, a close business associate of Jeffrey Epstein attempted to solicit investment in Faraday Future and other EV startups, as revealed by TechCrunch. Epstein ultimately did not invest.)

Faraday Future was salvaged by an investment from the major Chinese real estate conglomerate Evergrande. However, that partnership disintegrated swiftly as well, with Evergrande withdrawing by late 2018 and Faraday Future reducing its workforce even further.

Jia nominally resigned as CEO in 2019 and also sought personal bankruptcy protection to resolve billions of dollars of debt from LeEco that he had personally guaranteed. Nevertheless, behind the scenes, he remained largely in control of the company.

This became problematic when Faraday Future went public in 2021 and raised around $1 billion. Members of the newly formed public company board believed that Faraday’s executives had misrepresented Jia’s level of control over daily operations — particularly after a short seller report scrutinized Faraday Future — prompting them to establish a special committee to investigate.

The committee hired an external law firm and a forensic accounting firm and, within the first few months, began delivering its findings directly to the SEC, as three sources familiar with the investigation relayed to TechCrunch.

Between January and April 2022, Jia was sidelined due to the board’s investigation, a senior VP named Matthias Aydt (currently co-CEO with Jia) was placed on probation for six months, and another VP named Jerry Wang (Jia’s nephew) was suspended. (Wang eventually resigned due to a “failure to cooperate with the investigation,” per company filings, but has since returned to Faraday Future.)

The committee’s efforts also revealed that Faraday Future had, in the two years leading up to its public listing, partially survived through multi-million-dollar loans provided to the company by low-level employees connected to Jia — referred to as “related party transactions” in legal terms.

On March 31, 2022, Faraday Future announced that the SEC had initiated its probe. The startup disclosed the DOJ’s requests for information in June.

Dodging another bullet

Throughout the remainder of 2022, amid the initial phases of the SEC investigation, employees and individuals close to Jia organized a campaign to reclaim control of the board and his company. This ultimately led to death threats directed at some directors, who eventually resigned, allowing those close to Jia to once again manage the company.

Faraday Future finally began delivering the first few FF91 SUVs in early 2023. Former employees have filed lawsuits against the company, alleging these were not genuine sales and that the company deceived investors. The SEC investigators handling the case issued subpoenas to Faraday Future regarding concerns related to these sales, as filings indicate.

Former executives and employees were initially deposed by the SEC in 2024, according to sources familiar with the investigation. The SEC conducted longer depositions with some of them in the first half of 2025, the sources indicated.

The Wells Notice delivered in July 2025 indicated SEC staff had made “a preliminary determination to recommend that the Commission file an enforcement action against the Company alleging violations of various anti-fraud provisions of the federal securities laws.”

Specifically, the Wells Notice mentioned “purported false or misleading statements” made during the SPAC merger process regarding “related party transactions” and Jia’s “role in the Company.” Jia, his nephew Wang, and two other unnamed employees also received Wells Notices.

Faraday Future is still attempting to sell the FF91, but it has also recently adapted its business in several ways. The company is importing more affordable hybrid and electric vans from China. It seems to be selling rebranded versions of Chinese robots and transformed a publicly traded biotechnology company into one focused on cryptocurrency.

These efforts have not alleviated the company’s challenges. On Friday, the company announced it had received a warning from Nasdaq indicating its stock price had fallen below the minimum of $1, which could eventually result in the company being delisted.

This story has been updated with a statement from Faraday Future.