The SEC has officially closed its four-year investigation into electric vehicle startup Faraday Future, marking a significant moment in the agency’s enforcement history.
The United States Securities and Exchange Commission (SEC) has concluded its investigation into electric vehicle startup Faraday Future, a decision that comes after a lengthy four-year probe. The investigation focused on allegations that the company made “false and misleading statements” following its public debut through a merger with a special purpose acquisition company (SPAC) in 2021.
During the investigation, the SEC scrutinized claims made by Faraday Future regarding the sales of its first electric vehicles, which were reportedly fabricated according to at least three whistleblowers who were former employees of the company. The SEC’s inquiry included multiple subpoenas and depositions of former employees and executives throughout 2024 and 2025.
In July 2025, Faraday Future disclosed that the SEC had issued “Wells Notices” to the company and several of its executives, including founder Jia Yueting. A Wells Notice is a formal communication from the SEC indicating that the agency’s staff has found sufficient grounds to recommend enforcement action.
In light of the SEC’s decision to close the investigation, Yueting expressed relief, stating, “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.” Faraday Future also confirmed that the SEC would not pursue any further action against its executives.
Despite the closure of the investigation, it remains unclear whether Faraday Future responded to the Wells Notices issued last year. As of February, the company indicated in regulatory filings that it had not yet done so, although it planned to engage with the SEC to argue that enforcement action was unwarranted.
Additionally, the U.S. Department of Justice (DOJ) had sought information from Faraday Future following the SEC’s initiation of its investigation in 2022. However, the company has referred to this as an “investigation” in its regulatory filings, while there has been no confirmation from the DOJ regarding any ongoing inquiry.
Historically, the SEC tends to pursue enforcement actions after issuing Wells Notices. A study conducted by the Wharton School in 2020 indicated that approximately 85% of targets receiving a Wells Notice ultimately face legal action from the SEC.
In recent years, the SEC has investigated numerous electric vehicle startups that went public via SPAC mergers. While many of these investigations have resulted in settlements, the agency has also dismissed probes into companies like Lucid Motors in 2023 and Fisker in 2025.
As Faraday Future moves forward without the burden of the SEC investigation, the company will likely focus on its strategic goals and the development of its electric vehicle offerings.
According to The American Bazaar, the closure of this investigation marks a pivotal moment for Faraday Future as it seeks to establish itself in the competitive electric vehicle market.