The American startup in the field of electric cars Faraday Future faces not only a significant lack of funds, but also internal conflicts. Ex-employees exposed numerous violations and potential lies to investors.
Former company employees Jose Guerrero and Victoria Xie allege in lawsuits that Faraday Future lied to investors when it told the first four FF91 SUVs sold, writes TechCrunch.
Guerrero, who was Faraday Future's senior director of sales and aftersales, and Xie, who was the go-to-market project manager, said the company announced the shipments before the sales process was complete. In three out of four cases, the electric cars were not paid for, in the fourth case, the payment came more than 2 months later. In total, the company claimed to have delivered 10 cars in 2023.
Guerrero and Xie say some employees at the company refused to announce sales early, and management then retaliated with punitive measures. The need to lie when announcing sales was explained by the desire to increase the price of the company's shares.
What's more, Guerrero and Xie claim that Faraday Future delivered the cars to the first customers without performing vehicle inspections beforehand. In addition, they emphasize that the cars were supplied with software that was not approved for road traffic. Both employees also say they were fired in retaliation for not keeping the issues quiet.
The new case also reveals that the company's founder, Jia Yueting, allegedly continues to control the company despite being ousted in 2022 as a result of an internal investigation into overstating the number of pre-orders for vehicles, as well as a lack of proper disclosure of the company's cash flows.
The company says it “takes very seriously the allegations made by previous employees in the two lawsuits” and is prepared to defend itself in court.
“FF believes it has a strong defense to the alleged claims and will pursue all available remedies to defend itself and the Company's dedicated employees against all allegations”– say company representatives.