SEC Ends Four-Year Investigation into EV Startup Faraday Future
The U.S. Securities and Exchange Commission (SEC) has formally closed its investigation into electric vehicle startup Faraday Future Intelligent Electric Inc. (NASDAQ: FFAI), bringing an end to a nearly four-year inquiry. The decision comes despite recommendations from SEC staff for enforcement action as recently as last year, according to sources familiar with the matter.
Investigation Details
The SEC’s investigation, which began in 2022, centered on potential “false and misleading statements” made by Faraday Future when it went public in July 2021 through a merger with a special purpose acquisition company (SPAC). Investigators also probed allegations that the company fabricated sales figures for its FF91 electric vehicle in 2023, claims initially raised by former employees [TechCrunch].
Throughout the investigation, Faraday Future received multiple subpoenas and saw numerous former employees and executives subjected to depositions in 2024 and 2025 [TechCrunch]. In July 2025, the company and key executives, including founder Jia Yueting, received “Wells Notices,” signaling the SEC staff’s intent to recommend enforcement action [TechCrunch].
The Department of Justice also requested information from Faraday Future during the SEC investigation, though it remains unclear whether the DOJ launched a full probe [TechCrunch].
SEC Enforcement Trends and Case Dismissal
The closure of the Faraday Future investigation is part of a broader trend of declining SEC enforcement actions. In the 2025 fiscal year, the SEC initiated only four cases against publicly-traded companies, a historic low [TechCrunch]. The SEC declined to comment on the matter.
It is relatively uncommon for the SEC to drop a case after issuing a Wells Notice; a 2020 study by the Wharton School indicated that approximately 85% of those receiving such notices ultimately face legal action from the SEC [TechCrunch].
The SEC has investigated numerous EV startups that went public via SPAC mergers, reaching settlements in almost all cases. Previous investigations were closed regarding Lucid Motors in 2023 and Fisker late in 2025 [TechCrunch].
Faraday Future’s Future Outlook
Faraday Future announced the conclusion of the SEC investigation with no enforcement action against the company, founder and Co-CEO YT Jia, FF President Jerry Wang, or any other team members [Business Wire] and [Financial Content]. The company stated that this provides regulatory clarity and allows it to focus on core businesses, pursue strategic financing and partnerships and attract talent [Business Wire].
Faraday Future is currently focused on selling the FF91, importing hybrid and electric vans from China, and exploring opportunities in robotics and cryptocurrency [TechCrunch]. However, the company recently received a warning from Nasdaq regarding its stock price falling below $1, potentially leading to delisting [TechCrunch].