Lordstown Shares Tumble After Justice Department Joins SEC Investigation

The U.S. Department of Justice will join the SEC in probing allegations on inaccuracies of public disclosures against truck preorders of Electric truck startup Lordstown Motors Corp’s RIDE, the Wall Street Journal reported.
The CEO and CFO of the company had recently resigned after Hindenburg Research raised concerns regarding the accuracy of certain statements about the company’s pre-orders.
Lordstown has repeatedly reassured investors that they had a pipeline of pre-orders that would keep their manufacturing pipeline operational into 2022.
The SEC started its probe after accusations that company executives, including the former CFO, sold significant personal stock holdings before publicly disclosing a significant quarterly loss and higher-than-expected expenses.
For 2020, Lordstown reported a $101 million net loss.
Price action: RIDE shares are trading lower by 11.6% at $9.15 on the last check Friday.