BMW Is Being Investigated By SEC: Do Automakers Really Sales Punch?

BMW (BMW.DE) has come under fire for its alleged sales practices and is reportedly being investigated by the Securities and Exchange Commission (SEC).

The German automaker confirmed the probe to CNBC through a company spokesperson after news of the SEC investigation was reported by the Wall Street Journal. According to the latter news outlet, the investigation claims that BMW is specifically “punching” its sales.

The practice of sales “punching” can help dealers meet company sales goals by self-registering cars as loaner vehicles and later selling them as used cars with low mileage.

The company has said it has stopped the practice of sales “punching,” which then BMW of North America CEO Ludwig Willisch said in 2016 “happens,” but it is not ideal, Automotive News reported.

This would not be the first time that the SEC has investigated an automaker for inflating its sales as it settled with Fiat Chrysler Automobiles in 2019 over boosting its U.S. sales numbers to keep a monthly streak going. Fiat Chrysler settled the charges for $40 million in September.

The SEC has not commented on the BMW investigation only telling CNBC that it “can neither confirm nor deny the existence or nonexistence of investigations.”

Shares of BMW stock were down 0.82% as of 9:26 a.m. EST on Tuesday.