Whistle-blowers Allege Misrepresentations and Retaliation at Faraday Future

Two internal whistle-blowers at Faraday Future have come forward with allegations of deception regarding the electric vehicle (EV) company’s sales figures and claims of retaliation against employees who spoke out. Jose Guerrero and Victoria Xie have filed lawsuits against Faraday Future, its founder Jia Yueting, and the company’s head of HR, Nan Yang, in Los Angeles Superior Court, alleging wrongful termination, breach of contract, and infliction of emotional distress.

The lawsuits shed light on the ongoing internal turmoil within Faraday Future, with claims that Jia Yueting has maintained control over the company despite being side-lined in 2022 following an internal probe. The situation worsened as the company faced financial difficulties, resulting in employee furloughs and layoffs, and nearly being evicted from its Los Angeles headquarters due to missed lease payments. Concurrently, Faraday Future faces active investigations from the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ).

In response to the lawsuits, a spokesperson for Faraday Future stated that the company takes the allegations seriously and intends to defend itself against the claims.

Founder Jia Yueting has also refuted the allegations, stating his intention to file counter-lawsuits against the involved parties, citing false statements and defamatory allegations in the complaints.

The whistle-blowers’ allegations revolve around the purported fabrication of sales figures for Faraday Future’s electric SUV, the FF91. Guerrero and Xie claim that the company announced deliveries before completing the sales process, with several of the reported sales remaining unpaid for or delayed. They allege that pressure to announce sales prematurely led to retaliation against employees who raised compliance concerns.

Moreover, the lawsuits detail additional irregularities within Faraday Future’s operations, including executing sales agreements without pre-delivery inspections, improper documentation of software releases, and unauthorized repairs on customer vehicles, potentially violating regulatory requirements.

Xie, terminated shortly after submitting an internal whistle-blower letter, asserts that her firing was retaliatory. Guerrero, terminated for speaking up, filed an arbitration claim against the company.

Despite Jia Yueting’s official side-lining, the lawsuits claim that he maintains control over Faraday Future through a “shadow organization” and continues to influence major operational decisions.

The unfolding legal battle adds to the ongoing challenges facing Faraday Future, raising questions about corporate governance and transparency within the EV company.

The story has been updated with comments from Faraday Future and founder Jia Yueting.