It’s nearly been a year now since Hindenburg Research called Nikola a fraud for a video of semi-truck driving which onlookers later found out was not an operational electric semi, and now the Nikola founder is being charged over the video.
Nikola’s original founder, Trevor Milton, is being charged with securities fraud as of Thursday in a Southern District of New York federal court, according to The Verge.
The charges claim that Milton made a number of false claims regarding the company’s electric semi-truck, making it seem as if Nikola was closer to production than they really were – and ultimately, raising over $500 million in investments because of it.
The indictment says, “Milton sold a version of Nikola not as it was – an early-stage company with a novel idea to commercialize yet-to-be proven products and technology – but rather as a trail-blazing company that had already achieved many groundbreaking and game-changing milestones.”
GM Drops Nikola Equity Stake and Badger Deal, Shares Plunge https://t.co/fLrTeFCZoZ
— TeslaNorth.com (@RealTeslaNorth) November 30, 2020
During a promotional video, for which the fraud was publicized, the Nikola One electric semi was seen “in motion,” though later onlookers discovered that the truck had literally been pushed into motion, rather than using its own electric drivetrain – a feature that was well-noted by Milton and Nikola in seeking investors.
Update: The SEC just filed parallel charges against Trevor Milton alleging he "engaged in a fraudulent scheme to deceive retail investors" and used his social media to "flood the market with false and misleading information about Nikola".https://t.co/1XMpaXPHA1 $NKLA
— Hindenburg Research (@HindenburgRes) July 29, 2021
Milton stepped down after the fake Semi driving video incident last year, and was replaced by Mark Russell, who took on the role of CEO. The company’s downfall also happened as a result of the video, amidst a nearly-signed contract with GM, a major Republic Services deal which was later trashed, and a slew of other opportunities that would have otherwise looked like the only direction for the company was up.
Contributing Writer at TeslaNorth.com from California’s southeast Bay Area. Covers electric vehicles, space exploration, and all things tech. Loves a good cup of coffee, live music and puppies. Buying a Tesla? Click here to get 1,000 free Supercharging miles.