The Securities and Exchange Commission has quietly put an end to its years-long probe into Faraday Future—a name that once lit up electric vehicle discussions and investor dreams. Despite a previous recommendation by SEC staff to pursue enforcement, the agency this week decided to walk away. TechCrunch learned of the closure through four sources who, protected by anonymity, described the end of a process that once threatened to capsize the struggling startup.
Word of the SEC’s retreat reached Faraday Future and everyone touched by the investigation only days ago. The timing is notable: new data reveals a dramatic slowdown in SEC action against publicly traded firms. In its most recent fiscal year, just four companies faced new enforcement cases—a historic dip. When pressed after hours, the SEC simply kept silent.
The Faraday Future case spanned nearly four years. Regulators wanted to know if the company painted an overly rosy picture—or outright lied—when it went public via a SPAC merger in 2021. That was only the start. As the first FF91 electric SUVs theoretically rolled out in 2023, accusations surfaced: had company insiders faked vehicle sales? At least three whistleblowers, once on Faraday’s payroll, thought so.
Subpoenas flew—Faraday’s own regulatory paperwork confirms that. In 2024 and 2025, the SEC didn’t stop at documents; they sat down with former executives and employees, trying to untangle what, exactly, had happened in Faraday’s crowded halls.
By summer of 2025, the heat turned up. Letters known as “Wells Notices” landed on desks—not just for the company, but for founder Jia Yueting and several leaders. A Wells Notice is the SEC’s way of warning: “We’re about to take you to court.” But this is where the story twists.
“We can move forward now,” Jia declared in a Sunday statement, expressing no small relief. Five years burned on paperwork and legal wrangling could now be channeled into “strategy execution”—his words. Importantly, Faraday reported that the SEC also chose not to pursue any action against individuals named in the case.
Curiously, it’s unclear if Faraday ever bothered to answer those Wells Notices. As late as February, the company told regulators they hadn’t formally responded, but intended to. Maybe the closure rendered a defense unnecessary.
After the SEC case launched, the Department of Justice asked Faraday for information—and Faraday started referring to a “DOJ investigation” in their own filings. But the DOJ kept its intentions opaque, never confirming whether it truly launched a full probe.
It’s highly uncommon for the SEC to skip enforcement once a Wells Notice is sent. Academic research out of Wharton shows that most—roughly 85%—who get such a letter end up fighting the agency in court. Yet with Faraday, and a handful of other recent EV startups, the pattern changed. The SEC eyed almost every SPAC-fueled electric vehicle company in recent years, typically settling—sometimes, as with Lucid in 2023 and Fisker last year, dropping the case entirely.
How did Faraday Future become a lightning rod for regulatory drama? The story begins in 2014. Jia Yueting, still a titan in Chinese tech, dreamed big in California. Faraday sought to vault past Tesla’s shadow by poaching talent from giants like Apple and Tesla itself. At one point, payroll topped 1,400.
But ambition collided with reality. At CES 2016, Faraday’s flashy debut turned heads for its futuristic design, but behind the scenes, chaos brewed. By the following year, the company barely limped along, cash evaporating, layoffs mounting. Jia’s Chinese empire collapsed, forcing him into exile in California after being blacklisted for debt back home. (Trivia for headline chasers: a former Epstein associate once pitched Faraday to the infamous financier, though no money ever changed hands.)
Rescue attempts followed. Evergrande, a major Chinese real estate group, bought in—then quickly backed out, triggering another round of layoffs. Jia filed for personal bankruptcy by 2019, shedding billions in guarantees, and nominally stepped away. But, as insiders and later public company directors discovered, the founder’s grip never truly loosened.
Once Faraday became a public company and secured a billion-dollar raise, cracks widened. Board members suspected misleading disclosures about Jia’s influence, especially after short sellers zeroed in. A special committee brought in lawyers and forensic accountants. Closely watched, the company self-reported findings to the SEC. Within months, Jia was sidelined, a key executive placed on probation, and Jia’s nephew suspended (then resigned, briefly, before returning).
The committee also discovered loans from rank-and-file staff tied to Jia—related party deals that kept Faraday’s lights on during tough times. By spring 2022, the SEC probe was public, as were DOJ info requests.
Yet, the fight for control wasn’t over. Amid regulatory chaos, loyalists close to Jia waged an internal campaign. Pressure escalated into death threats; several directors resigned. Jia’s camp moved back in.
Amid scandal and lawsuits alleging fake sales, the first FF91s trickled out in early 2023. The SEC, unblinking, continued its scrutiny—subpoenaing records and questioning former staff in 2024 and 2025. By July 2025, the agency’s formal warning cited potential anti-fraud violations—linked to SPAC disclosures and Jia’s real role.
Despite everything, Faraday still markets the FF91, now importing and relabeling Chinese vans and robots. Recently, they even pivoted a biotech company into the crypto business. The future, however, remains precarious. Nasdaq warned Faraday its stock could be de-listed after dipping below a buck.
The shadow of investigation has lifted, but whether Faraday can outrun its past is an open question. The saga, for now, pauses on a note of reprieve—but not resolution.
