Boss Accused Of Taking $75M From Faraday Future For Kid's Trust Fund

Faraday Future's own boss could be looking to profit from his company's consistent mishandling of cash.

The auto industry is such a wild, dynamic, and twisted place that even a short ride through it will run some ragged and drive others to madness. Faraday Future, it seems, has found itself in the latter camp after being faced with a mountain of lawsuits and controversy that threatens to undermine the entire operation. And now there’s this: a story from The Verge that uncovers what now looks more like a shady operation going on behind a facade of eco intentions and tech-savvy disruptors than an aspiring automaker.

It’s not that Faraday Future had bad intensions from the start (though there’s not a line of people coming to FF’s defense), but its practice of mismanaging money seems to be bringing it an onslaught of trouble that can only lead to one place: catastrophic failure. Not every FF member is supposed to go down in flames, however. According to accusations outlined in the report, FF’s main source of funding, a man by the name of Jia Yueting (YT for short), may have taken cash from his own company for personal gain. For Faraday Future, YT has been more than just an investor. His cash has come with strings attached, which he's used to play a close role in the development process.

Sometimes too close, according to some employees that have claimed his constant intervention in the design and development process once led FF to miss an important reveal at the CES show in Las Vegas to accommodate changes he had ordered on the car. However, critique seems to be the norm for YT. So much so that he has filed a lawsuit against a software programmer by the name of Gu Yingqiong—a man who makes frequent accusations and has gone as far as to call Faraday Future a “Ponzi scheme”—for his latest allegation: that YT used cash from Faraday Future’s bank account for personal gain.

Whether or not that’s true remains to be seen, but Yingqiong claims that YT was trying to set himself up to benefit from Faraday Future’s coffers by creating a $75 million trust fund for his children using money meant to bring us the FF91 EV. It seems that the courts will have to determine if Yingqiong is actually slandering YT's name or if the accusations are true, but it’s yet another piece of Faraday Future’s story that makes the company seem as if it’s doomed to fail before it builds its first production car.

View the original article here

Faraday Future Is One Company Tesla Need Not Fear

The EV startup is burning through cash and leaving vendors high and dry.

Late last year Faraday Future was facing imminent closure, its finances were dwindling, employees weren’t turning up for work and founding members were abandoning ship. Then the company’s controversial chief investor and now CEO, Jia Yueting, managed to secure an $800 million investment from Chinese Real Estate group, Evergrande.

The deal came with some harsh conditions which had Faraday Future giving away its intellectual property as well as some of its assets. Despite this, it seemed that Faraday indeed had a future, and up until very recently, the long-awaited FF91 EV seemed to be finally nearing production status. The Detroit Bureau has now unearthed a very different reality, one that seems rather similar to last year’s dilemma.

It appears that Evergrande has filed a complaint with the Hong Kong Stock Exchange accusing Jia Yueting of not honoring the deal that they had made in January. The issue seems to be that whereas Evergrande committed to and paid the $800 million investment, Jia Yueting claims that they are also supposed to inject another $700 million into Faraday Future come January 2019, something he desperately needs as the initial investment has already been spent.

Suppliers are not being paid and some have started procedures to reclaim what they can. Jia is no stranger to controversy as he was accused of creating a $75 million trust fund for his kids by using money intended for the FF91. He has also refused to return to China where he is wanted for questioning by the Chinese Securities Regulatory Commission (CSRC) for debts owed by him to both FF and his tech firm LeEco.

Amidst all this chaos, the FF91 EV meanwhile has become a sideshow instead of the main event. Rival EVs from both established firms like Tesla and imminent arrivals from BMW, Porsche and Mercedes will only make it harder for this new model to gain traction in its segment.

Yueting once again seems to have been partly to blame, continuously interfering with the design and development process and expanding the company’s production targets to seemingly impossible levels, delaying the finalization of the potentially game-changing EV.

The single working FF91 apparently caught fire in front of Faraday Future employees when it was shown to them in September. Clearly, there are some serious issues that need to be resolved if this car, dubbed the 'Tesla Fighter,' is ever to get anywhere near to production status.

View the original article here