SEC Subpoenad CEO of Stimulus-Backed Electric Vehicle Company
Lachlan Markay /
The Securities and Exchange Commission filed a subpoena against electric vehicle company ECOtality in October of 2010, requesting documents relating to its investigation into insider trading by some of the company’s top executives. The name of at least one of those individuals has now been revealed.
ECOtality is a poster child for the administration’s push to put a million electric vehicles on the road by 2015. President Obama specifically cited the company in his 2011 State of the Union address, while Ted Karner, president of subsidiary ECOtality North America, looked on as Michelle Obama’s guest.
The investigation, which Scribe first uncovered in October of last year, seeks information on the announcement of a $100 million Energy Department grant made in 2009 – one of two stimulus-backed grants to ECOtality, which totaled about $115 million, to install electric vehicle charging stations.
The subpoena specifically targets ECOtality CEO Jonathan Reed and two of the company’s board members. ECOtality announced last year that “certain individuals” were under investigation, but would not specify who.
CBS News reports:
The government also wants all communication regarding the federal grant from at least four Ecotality employees and two board members including the company’s CEO Jonathan Read. The company was required to supply documents to the SEC by early January.
A company spokesperson told CBS News in an email, “We are cooperating fully with the SEC and have no further disclosures or updates that we are able to provide outside of our public filings.”
ECOtality is also under significant financial strain, and has only to install 6,400 of the 14,000 EV charging stations for which it received taxpayer money. Its struggles are part of a larger trend in the EV industry. According to an automotive industry expert quoted by CBS, the president’s goal of one million electric vehicle goal will not likely materialize. Half that number is more likely.
“The economic reality is that [electric vehicles] are not ready for primetime,” insisted Heritage’s Nick Loris. “The best indicator for when they will be is when the government stops using taxpayer dollars to subsidize their production and consumption.”
Note: this post has been revised to reflect the fact that the subpoena in question was issued in October of 2010.