A former Tesla Australia director has pleaded guilty to insider trading after he made almost $29,000 by investing in a mining company – after learning his company had reached an in-principle agreement with it.

Ex-Tesla Motors Australia director Kurt Schlosser, from Sydney, pleaded guilty at the Sydney Downing Centre Local Court to two counts of insider trading this week.

The charges related to September 2020, when Schlosser bought more than 86,000 shares in Australian mining company Piedmont Lithium Limited, valued at 12c per share.

Schlosser had just been informed that Tesla had reached an in-principle agreement with Piedmont for the supply of lithium, something which had not been made public.

The deal was made public nearly two weeks later, and Piedmont’s share prices jumped on the news, up to as high as 60c a share.

Schlosser soon sold his shares after the agreement went public, netting a profit of $28,883.53.

He also informed a friend of the insider information while knowing they were likely to also acquire shares in the mining company, the court heard.

The charges were brought forward following an investigation by the Australian Securities Investment Commission (ASIC).

“On 16 September 2020, Mr Schlosser acquired 86,478 shares in the mining company Piedmont Lithium Limited after being informed, in his role as country director of Tesla Australia, of inside information regarding an in-principle agreement that Tesla Australia’s ultimate holding company, Tesla Inc, had reached with Piedmont for the supply of lithium,” ASIC said in a statement.

“After information about the agreement became public and Piedmont’s share price rose, Mr Schlosser sold his Piedmont shares for a net profit of $28,883.53.”

Schlosser pleaded guilty to one count of trading while in possession of inside information, and one count of communicating inside information to an associate in breach of the Corporations Act.

Each of these charges carries a maximum penalty of 15 years imprisonment.

The binding agreement between Tesla Inc and Piedmont Lithium Limited related to the supply of spodumene concentrate on a five-year, fixed-price binding purchase commitment.

It saw Tesla purchase about one-third of the mining company’s planned 160,000 tonnes of annual spodumene lithium production across five years.

Schlosser has now been committed to the Sydney District Court, where he will appear in mid-December for a sentence date to be fixed.

He was prosecuted by the Commonwealth Director of Public Prosecutions.

Revelations of the insider trading by Tesla’s top Australia director came in the same week that the company was forced to recall more than 1,000 of its electric cars in the country due to a steering fault that may increase the risk of an “accident causing serious injury or death”.

The recall was issued by the Australian Department of Transport on Wednesday.

The issue is in relation to the Tesla Model S and Model X cars which were sold between 2017 and 2020, and centres on a risk that their electronic power-assist steering systems could lose power and “require a greater steering effort from the driver”.

“This may result in a reduced or loss of power steering assist and could require greater steering effort from the driver particularly at low speeds,” the Department of Transport notice said.

“Upon experiencing reduced or lost power steering assist, an audio alert will trigger, and a visual alert will appear on the instrument cluster.”

Impacted Tesla owners have been instructed to either download a software update for their car or visit an authorised dealer.

There was another Tesla recall earlier this month, with more than 300 Model 3 vehicles impacted by a seatbelt issue.

There was also a fatal crash involving a Tesla Model Y vehicle in China this week. Tesla has said it will assist local authorities following the crash where two people had died and three were injured after the driver of the Tesla lost control of the vehicle.