WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission has sent subpoenas to Tesla Inc (TSLA.O) regarding Chief Executive Elon Musk’s plan to take the company private and his statement that funding was “secured,” Fox Business Network reported on Wednesday, citing sources. 
 
 The electric carmaker’s shares fell as much as 4 percent but cut their losses after Goldman Sachs Group Inc (GS.N) said it was dropping equity coverage of Tesla because it is acting as a financial adviser on a matter related to the automaker. 
 
 Investors viewed the Goldman statement as confirming a tweet from Elon Musk on Monday about working with Goldman, even as the reported subpoenas indicated the SEC has opened a formal investigation into a matter. 
 
 The latest news extended the roller-coaster ride for Tesla investors in recent days, adding to uncertainty about the future course of the company and whether a deal can be done amid growing regulatory complications. 
 
 Tesla and the SEC declined to comment. 
 
 Musk stunned investors and sent Tesla’s shares soaring 11 percent when he tweeted early last week that he was considering taking Tesla private at $420 per share and that he had secured funding for the potential deal. 
 
 The shares fell 2.6 percent to $338.69 on Wednesday, below $341.99, their closing price the day before Musk tweeted his plan to take Tesla private. 
 
 The Tesla CEO provided no details of his funding until Monday, when he said in a blog on Tesla’s website that he was in discussions with Saudi Arabia’s sovereign wealth fund and other potential backers but that financing was not yet nailed down. 
 
 Musk also tweeted late Monday night he was working with Goldman Sachs and private equity firm Silver Lake as financial advisers. However, as of Tuesday, Goldman was still negotiating its terms of engagement with Musk, according to a person familiar with the matter. 
 
 The 47-year old billionaire’s tweet about secured funding may have violated U.S. securities law if he misled investors. On Monday, lawyers told Reuters Musk’s statement indicated he had good reason to believe he had funding but seemed to have overstated its status by saying it was secured. 
 
 FILE PHOTO: Tesla Motors Inc Chief Executive Elon Musk pauses during a news conference in Tokyo September 8, 2014. Musk said on Monday that he would not be surprised if there was a significant deal with Toyota Motor Corp in the next two to three years, though there were no definitive plans. REUTERS/Toru Hanai/File Photo 
 
 The SEC has opened an inquiry into Musk’s tweets, according to one person with direct knowledge of the matter. Reuters was not immediately able to ascertain if this had escalated into a full-blown investigation on Wednesday. 
 
 This source said Tesla’s independent board members had hired law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP to help handle the SEC inquiry and other fiduciary duties with respect to a potential deal. 
 
 The Wall Street Journal said the SEC was seeking information from each Tesla director. ||||| The Securities and Exchange Commission (SEC) is ramping up its investigation into Tesla co-founder and chief executive Elon Musk after he tweeted last week that he was considering taking the electric-car maker private, and said “funding secured”, FOX Business’ Charlie Gasparino exclusively reported. 
 
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 The investigation is now "formal", according to Gasparino. 
 
 Tesla shares sank on news of the probe on Wednesday. 
 
 Ticker Security Last Change %Chg TSLA TESLA INC. 302.26 -45.05 -12.97% 
 
 “They’re between a rock and a hard place on this one,” Gasparino said. “[On one hand] it looks like what Elon Musk said when he said funding was secured, particularly after his statements recently, was not accurate. They don’t have the funding actually secured. They’re talking to people, what we understand, about the process of going private.” 
 
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 Tesla's board has yet to confirmed any funding details, but Musk outlined additional details on it in a blog post, noting he was all but certain to have landed the investment from the Saudi sovereign fund in July. 
 
 Still, that doesn't confirm his statement, considered "material" and likely problematic for the SEC. 
 
 The San Francisco office of the SEC has sent subpoenas to Tesla regarding its privatization plans and Musk’s statement to determine whether the billionaire inventor intentionally misled investors, Gasparino said. 
 
 Tesla, in response, has also hired two law firms, Paul, Weiss, Rifkin, Wharton & Garrison to help deal with the SEC, and Latham & Watkins to advise on privatization. 
 
 Last week, Musk shocked investors after tweeting that he could take the company private at $420 per share, the stock soared on the news before being halted by the Nasdaq. 
 
 A former SEC commissioner told FOX Business last week if Musk's funding disclosure was not accurate, which appears to be the case a week later, it would create a new round of legal issues for Musk. 
 
 Both Tesla and the SEC have declined to comment about the investigation. ||||| Image copyright Getty Images 
 
 Tesla's board has confirmed that it will consider the proposal by chief executive Elon Musk to take it private. 
 
 A statement was issued by six members of the electric carmaker's board after Mr Musk tweeted to say he had the funding to de-list the company. 
 
 The board had "met several times over the last week" to discuss going private, the statement said. 
 
 They said this "included discussion as to how being private could better serve Tesla's long-term interests". 
 
 Mr Musk said in his tweet on Tuesday that shareholders would be offered $420 (£326) per share, valuing the business at more than $70bn. 
 
 This would make it the biggest deal of its kind, surpassing the purchase of utility TXU Corp in 2007 for $44bn by a consortium. 
 
 The brief statement by six of the nine board directors said Mr Musk had "opened a discussion" about taking the company private last week. 
 
 The discussions "addressed the funding for this to occur", the six directors added. They did not include Mr Musk, his brother Kimbal Musk, and Steve Jurvetson, a venture capitalist. 
 
 'Irregular' announcement 
 
 The board statement came amid questions about how Mr Musk opted to disclose the possible de-listing to investors. 
 
 While companies are allowed to make announcements via social media, typically they also make a simultaneous regulatory filing, said Andrew M Calamari, a partner at the law firm Finn Dixon & Herling and former director of the New York office of the Securities and Exchange Commission, the US market regulator. 
 
 "Just in terms of the style of this, it strikes me as very irregular," Mr Calamari said. 
 
 "It also raises questions about his intent," he added. "Was he in earnest in what he's saying, or does he have some other motive" like influencing the stock price. 
 
 Tesla shares reached a peak of $368 after Mr Musk's tweets on Tuesday, before trading on the stock market was halted. 
 
 Trades resumed later that afternoon, after the company published an email from Mr Musk to employees elaborating on the plans. 
 
 Tesla shares surged close to their all-time high of $385, which they touched almost a year ago, but fluctuated on Wednesday after the board members issued their statement. 
 
 'Wild swings' 
 
 In the staff memo, Mr Musk explained why he wanted to take the company private. 
 
 "As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders," he wrote. 
 
 "Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long term," he wrote. 
 
 He added that the company was "the most shorted stock in the history of the stock market" - a trading strategy which assumes share prices will fall - so "being public means that there are large numbers of people who have the incentive to attack the company". 
 
 Those traders are likely to have lost money when the share price rose on the announcement about a delisting. 
 
 Questions continue 
 
 Mr Musk already owns 20% of the company. He said his intention in taking the company private was not to increase his personal holding and his plan would give existing investors the option to retain their shares. 
 
 Regulators are likely to be interested in what evidence exists - such as agreements with investors or banks - for Mr Musk's claim that funding was "secured", Mr Calamari said. 
 
 The Securities and Exchange Commission, the US market regulator, has inquired about the issue, the Wall Street Journal reported. 
 
 The structure of the deal also remains ambiguous, said Adam C Pritchard, professor of securities law at the University of Michigan. 
 
 If more than 2,000 investors opt to retain their shares, then the firm would be subject to the disclosure rules of a public company, he added. 
 
 "Intuitively it doesn't make sense because it would still be a public entity, and the public entity status is what is apparently objectionable to Musk," Mr Pritchard said. 
 
 Steven Kaplan, a University of Chicago professor who researches private equity, said it would be difficult for Mr Musk to raise the necessary finance when Tesla has still not made a profit. 
 
 "The company is cash-flow negative. How do you use any debt on a company that is cash-flow negative?" he said.
– Elon Musk wasn't blowing smoke. The BBC reports on a three-sentence statement issued by six of Tesla's nine board members saying the board had "met several times over the last week" to discuss Musk's proposal to take the company private, which he announced via an unexpected tweet Tuesday. The talks "included discussion as to how being private could better serve Tesla's long-term interests" and the statement ends by saying the board "is taking the appropriate next steps to evaluate this." The three board members who did not sign the statement are Musk, brother Kimbal Musk, and a board member who is on leave, reports the Wall Street Journal. At MarketWatch, Steve Goldstein flags some unresolved points: The statement didn't elaborate on Musk's claim of "funding secured" and raised but didn't answer a question of timing. "'Last week' predates Tesla's filing on Monday of its 10-Q with the Securities and Exchange Commission, which didn't mention such discussions. News of a takeover would certainly be considered material," he writes. Shares of Tesla are currently down about 1%.