Musk's Trump ties could wipe away $2.3 billion in legal exposure
Senator Richard Blumenthal (D-CT) released a memorandum on Monday morning that quantifies the amount of money in civil and criminal penalties Elon Musk and his companies could avoid thanks to Musk's influence in the Trump administration. Musk, a senior advisor to President Trump and the leader of the White House’s Department of Government Efficiency (DOGE), and his companies face "at least 65 actual or potential actions by 11 different federal agencies," according to the memo. The memo estimates that, with Trump’s help, Musk's companies could avoid at least $2.37 billion in liabilities.
The estimate is based on the potential financial liabilities associated with 40 of those actions. Blumenthal and his staff were unable to provide a financial estimate for the remaining 25 matters, including "multiple investigations with the National Highway Traffic Safety Administration ranging from unexpected braking or acceleration, to steering wheel detachment, to crash reports involving Tesla’s autonomous driving technology." In other words, $2.37 billion is a conservative estimate.
Blumenthal shared the memo with all five of Musk’s companies on Sunday in letters to their general counsels. The letters request that the companies share "all non-public agency information… that has been given to Mr. Musk or Tesla representatives since January 20, 2025." The senator also asked the attorneys to detail what steps the companies have taken to prevent Musk's work with the federal government "from impacting or influencing any pending litigation, regulatory, or investigative proceedings against the company."
The memo was produced by the Senate Permanent Subcommittee on Investigations (PSI), of which Blumenthal is the ranking member. "PSI has conducted an analysis that aims to measure the liability that Mr. Musk and his companies potentially faced at the time of the transition in January 2025," Blumenthal wrote in his letter to Tesla’s acting chief counsel, Brandon Ehrhart. "The Subcommittee’s research shows that Mr. Musk may stand to avoid at least $2.3 billion in liability risk as a result of the stranglehold he has placed over federal enforcement, including more than $1.8 billion at Tesla."
Similar letters were sent to SpaceX, Musk’s rocket, satellite, and broadband internet company; xAI, Musk’s artificial intelligence and social media company; Neuralink, Musk’s brain-computer interface company; and the Boring Company, Musk’s transit enterprise. Tesla, SpaceX, xAI, Neuralink, and Boring did not immediately respond to requests for comment.
The majority of Tesla’s $1.8 billion in potential avoided penalties, estimated by the PSI memo, were related to a Biden-era Department of Justice investigation into claims the automaker made about its driver assist software. In 2021, the DOJ opened a criminal investigation into Tesla for allegedly misleading consumers for years by overstating the capabilities of its Autopilot and Full-Self Driving (FSD) products. Citing a section of the U.S. code — 18 U.S.C. § 3571(d) — that allows judges to levy fines worth double that of the profits an enterprise earned from a crime, the subcommittee estimated that Tesla could avoid more than $1.1 billion in liability in the event that Trump’s DOJ closes the investigation into Autopilot and FSD.
"The Subcommittee used Tesla’s reported 2024 [FSD] revenue of $596 million to estimate FSD-related gain," the memo states. "Doubling this amount… would result in a criminal fine of $1,192,000,000."
The DOJ’s investigation into Tesla for potential securities or wire fraud related to its self-driving products remains in progress. But on Friday, the Department of Transportation announced that it would "slash red tape" regulating self-driving technology, making it easier for companies like Tesla to release self-driving cars and software. The DOJ did not immediately respond to a request for comment.
The White House halted a separate investigation into Tesla after Trump signed an executive order in January suspending the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP). The office, which probes companies to ensure compliance with nondiscrimination laws, had been investigating allegations of workplace discrimination at Tesla’s factory in Fremont, California. In March, Trump tapped Catherine Eshbach, a former SpaceX attorney, to lead the agency. Eschbach has informed the office’s staff that she will reduce the OFCCP’s "scope of mission" and cut its workforce "consistent with the administration-wide DOGE agenda."
If the investigation is formally closed, as seems likely, the PSI memo estimated that the company would avoid "more than $460 million in potential penalties." The OFCCP did not immediately respond to a request for comment.
At SpaceX, the PSI estimated that Musk, through "the stranglehold he has placed over federal enforcement," could avoid more than $46 million in liabilities, nearly all of which stem from an investigation into the rocket company’s hiring practices. In 2023, the DOJ filed a complaint alleging that SpaceX discriminated against asylee and refugee job applicants. The company argued that hiring such applicants would violate export control laws, a claim that the Biden DOJ denied. A month after Trump entered the White House, the DOJ dismissed the case with prejudice.
The PSI arrived at the $46 million estimate by taking the number of employees SpaceX hired during the relevant period, 10,000, and multiplying it by $4,610, the maximum civil penalty under the section of the U.S. code that makes it illegal for employers to knowingly discrimate against workers based on their citizenship or immigration status.
The memo is part of a broader PSI inquiry into the ramifications of Musk’s influence and control over federal entities.
Pulling musk companies' legal and financial executives into investigations on possible criminal wrong doing is genius. You go Sen Blumenthal.
unbelievable... thank you for this