Charges in the United States With Fraud, Nikola Founder
According to an indictment published Thursday, US authorities charged Nikola founder and former executive chairman Trevor Milton with misleading investors over a slew of promises regarding the company’s electric vehicles.
According to the 49-page document, Milton was charged with three counts of fraud by the US Attorney’s Office in New York.
According to the accusation, Milton, who left from Nikola in September 2020, allegedly said that the business had produced a “fully functional” semi-truck prototype when he “known that the prototype was inoperable.”
According to the indictment, Milton made these and other false assertions in order to “induce retail investors to purchase Nikola’s shares.”
When Milton’s representations were revealed to be untrue, shareholders “suffered tens and even hundreds of thousands of dollars in losses, including, in some cases, the loss of their retirement savings or cash that they had borrowed to invest in Nikola,” according to the indictment.
Milton rose to notoriety in September 2020, shortly after going public through a merger with a special-purpose acquisition vehicle, when it announced a cooperation with General Motors (SPAC).
Things, however, swiftly fell apart. Hindenburg Research produced a study accusing the startup of “intricate fraud” based on repeated lies by Milton two days after the GM agreement was revealed.
Milton left the company later that month, and in late November, GM called off the deal to buy a stake in Nikola.
In securities filings, Nikola stated that it is working with the Justice Department inquiry.
Nikola’s stock fell 7.5 percent to $13.13 in premarket trade.