(By Balaseshan) Tesla Motors Inc. (NASDAQ: TSLA) shares are dropping amid reports that the electric vehicles manufacturer may be under a federal probe for using foreign parts instead of American ones.
The U.S. Immigration and Customs Enforcement (ICE) is investigating whether or not Tesla was using its foreign trade zone status to bypass federal loan requirements, which companies accepting the funding must use domestically produced parts, the Washington Times (WT) reported.
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The WT report also stated that the ICE approached the Department of Energy's Office of Inspector General a year back, ahead of Tesla's "subzone" trade zone application approval in September 20, 2012.
The energy department declined to join the investigation, saying the funding to Tesla came about via a federal appropriations bill and not under President Barack Obama's stimulus program, the WT stated.
The investigation details came into light as a result of a request by The Washington Times for final investigations summaries by the Energy Department for probes involving federal stimulus funds.
In early 2010, the Department of Energy closed its $465 million loan with Tesla for construction of a manufacturing facility in southern California on the Model S electric sedan and a power-train manufacturing facility in Palo Alto, California.
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TSLA is trading down 2.05% at $33.91 on Tuesday. The stock has been trading between $22.64 and $39.95 for the past 52 weeks.