Sen. Elizabeth Warren has expressed concerns about Elon Musk, the CEO of Tesla, and his possible conflicts of interest, particularly with reference to his use of Tesla’s resources to further his other businesses, SpaceX and xAI.
In a 10-page letter to Tesla’s Chairwoman, Robyn Denholm, Warren questioned, “Tesla’s Board of Directors appears to be failing to meet its fiduciary duties to Tesla’s shareholders by neglecting to address company CEO Elon Musk’s apparent conflicts of interest.”
Warren, who is a member of the Senate’s Banking and Armed Services committees, has previously voiced similar concerns and asked the SEC to look into Tesla and Musk. In late 2022, following Musk’s billion-dollar sale of Tesla shares to partially fund a leveraged takeover of Twitter (which he subsequently renamed as X), she also corresponded with Denholm.
Musk has been criticizing Warren for a long time. Since at least 2021, he has called her “Senator Karen,” and he has taken exception at her efforts to abolish tax loopholes for companies and billionaires, raise taxes on the extremely affluent, and rein in corporate “greedflation.”
In her letter, Warren raised concerns about Elon Musk’s creation of the AI startup xAI outside of Tesla, despite Tesla’s own focus on AI. She also pointed out Musk’s threats to work on robotics and AI outside of Tesla if he didn’t get more control over the company, and his push for Tesla shareholders to approve a $5 billion investment in xAI.
Warren’s letter was sent two months after CNBC revealed that emails from Nvidia employees also suggested that Musk had sent a substantial shipment of AI chips meant for Tesla to X instead of Tesla.
Warren also wants to know about the hiring practices of xAI that have taken place at Tesla, as well as the resignation of a director who left the firm allegedly due to the board acting “like a family company with fiefdoms, rather than a public company with stringent rules and regulations.”
Warren has given Denholm and Tesla until August 23 to respond to inquiries about the board’s supervision of Musk and the “entanglements” between his several companies.
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