TuSimple Holdings Inc TSP faces a federal investigation for allegedly improper funding and technology transfer to a Chinese start-up.

The concurrent investigations by the FBI, SEC, and Cfius examined TuSimple’s relationship with Hydron IncThe Wall Street Journal reports. One of the co-founders of TuSimple prompted Hydron to develop autonomous hydrogen-powered trucks.

FBI and SEC investigators investigated whether TuSimple and its executives, primarily CEO Xiaodi Hou, had violated fiduciary duties and securities laws by failing to adequately disclose the relationship.

They also investigated whether TuSimple shared US-developed intellectual property with Hydron and whether this action defrauded TuSimple investors by sending valuable technology to a foreign adversary.

Hydron operates primarily in China, where Mo Chen, co-founder of Tu Simple, spends most of his time. Chinese investors supported the startup.

TuSimple’s Board of Directors launched its investigation in July to investigate whether TuSimple incubated Hydron in China. Investigators investigated whether Hou was involved in setting up and providing technology for Hydron and was paid for it without providing the correct details.

TuSimple’s spokesman said Hou has never been an employee of Hydron or received any payment from Hydron and has no financial interest in the company.

Cfius intervened earlier this year to force TuSimple to isolate much of its US data and technology from its Chinese subsidiary, former employees said. Most China-based TuSimple employees had access to the source code and other proprietary technologies created by US employees.

TuSimple’s spokesman said he was considering alternatives for TuSimple’s Chinese subsidiary, including a potential sale.

When Hydron launched, it recruited TuSimple employees and leveraged TuSimple’s technology expertise and intellectual property. Some employees worked for Hydron while continuing to work for TuSimple and sometimes received shares in Hydron.

TuSimple spokesman said the company has a…