Trevor Milton, the fast-talking showman founder of Nikola and the electric truck startup’s former CEO and executive chairman, has been charged with three counts of fraud.
Milton “engaged in a fraudulent scheme to deceive retail investors” for his own personal benefit, according to the federal indictment unsealed by U.S. Attorney’s Office in Manhattan on Thursday. Milton was charged with two counts of securities fraud and wire fraud by a federal grand jury.
Specifically, prosecutors detailed in the complaint how Milton used social media and frequent appearances on television in a PR blitz that flooded “the market with false and misleading information about Nikola” before the company even produced a product.
The charges reflect a fast and furious run for Nikola and Milton, who founded the company in 2015. Milton received more attention after unveiling the first prototype and boasted that the company would produce “the iPhone of trucking.” Promises around other products, including an electric pickup truck called Badger, would soon follow, as well as plans to build a factory in Arizona.
In March 2020, the company announced it would go public via a merger with special purpose acquisition company VectoIQ Acquisition Corp. Milton frequently posted on Twitter, directing his messages to retail investors after the company went public that summer. Then, in September, just days after GM had announced a $2 billion investment in the company, noted short-seller Hindenburg Research accused Nikola of fraud. The U.S. Securities and Exchange Commission opened an inquiry in the matter and within two weeks Milton had stepped down as executive chairman.
Nikola issued a statement Thursday that distances itself from Milton, who is still its largest shareholder.
Trevor Milton resigned from Nikola on September 20, 2020 and has not been involved in the company’s operations or communications since that time. Today’s government actions are against Mr. Milton individually, and not against the company. Nikola has cooperated with the government throughout the course of its inquiry. We remain committed to our previously announced milestones and timelines and are focused on delivering Nikola Tre battery-electric trucks later this year from the company’s manufacturing facilities.