U.S.-based company TuSimple is developing autonomous trucks. It fired its CEO after an internal investigation found he had improper ties to China. Photo courtesy of TuSimple.
Oct. 31 (UPI) -- TuSimple, a California-based startup working on autonomous trucks, said Monday it terminated its own chief executive because of improper ties to China.
The company said in a filing with the Securities and Exchange Commission on Monday that, based on an internal investigation, some of its employees may have shared confidential information with Hydron, a Chinese firm also working on autonomous trucks.
Both TuSimple and Hydron share a co-founder, Mo Chen, who served previously as the California company's executive chairman. Suspected tech transfers and Hydron payments to TuSimple employees occurred before both sides signed a non-disclosure agreement.
The Federal Bureau of Investigation and the SEC are both looking at whether TuSimple defrauded investors with its relationship with Hydron, The Wall Street Journal reported Monday.
TuSimple, in turn, said it fired its own CEO, Xiaodi Hou, in connection with an ongoing internal investigation.
"Transparency, good judgment and accountability are critical values to our company," Brad Buss, TuSimple's lead independent director and chairman of the board, said in a statement. "We take these values extremely seriously."
A spokesperson for the company told the Journal that TuSimple wasn't aware of any federal probes.
Under U.S. law, any financial and technical transaction with Hydron should've been disclosed to determine what, if any, impact it would have on its investors. TuSimple told the SEC in its filing that the information shared is not related to intangible assets or patents.
"At this time, the company has not been able to determine the value, if any, of such information," it said.
A search for new CEO is underway. Ersin Tumer, the executive vice president of operations, will serve as CEO during the interim.
An indictment unsealed last week in New Jersey charged four individuals, including three Chinese intelligence officers working with the Ministry of State Security, with conspiring to act in the United States as illegal agents on behalf of a foreign government.