TRUCK TECH TRICKS
Nikola indictment
Trevor Milton, the founder of electric-truck startup Nikola, was indicted Thursday on charges of lying to investors by, among other fraudulent claims, pushing a truck down a hill to pretend it was “fully operational.”
Milton (inset) repeatedly lied about the capabilities of his company’s electric trucks and, after the company went public, he doubled down on lies in a bid to push the share price up, prosecutors alleged Thursday.
Milton also allegedly fibbed when he insisted on Twitter that one of Nikola’s trucks was being built entirely with the company’s proprietary tech- nology when in fact it was using parts from suppliers in Michigan and Europe.
“This is a very straightforward case. Milton told lies to generate popular demand for Nikola stock,” Manhattan US Attorney Audrey Strauss told reporters at a press briefing Thursday.
Among the whoppers Milton told investors were claims he made about the Nikola One, a semi-truck prototype, according to the indictment. Prosecutors said Milton knew the prototype did not work and didn’t even have its own internal power source, but repeatedly called it “fully functioning.”
Prosecutors said that at the 2016 unveiling of the truck, Milton made “categorically false” claims, even though he had been warned by the company’s chief engineer that the truck was “not even remotely ready to operate.”
At the time, the truck could not be driven and it couldn’t even turn on unless it was plugged into a generator or wall, prosecutors said. And the dashboard, which Milton at the event pretended to use to start the truck, was an off-theshelf tablet, not actually connected to the vehicle’s systems, the indictment said.
In another episode outlined by prosecutors, Milton allegedly attended a commercial shoot for Nikola in which the Nikola One truck appeared to be functioning when it in fact was simply rolling down a hill.
That allegation was among those outlined last September by New York-based short seller Hindenburg Research. Nikola denied the allegations at the time, but Milton resigned from the company shortly after.
Milton faces two counts of securities fraud and one count of wire fraud, according to the indictment.
He pleaded not guilty on Thursday and was released on bail of $100 million that was secured by a pair of unidentified, financially responsible people, along with two multimilliondollar properties in Utah that Milton owns.
“Trevor Milton is innocent; this is a new low in the government’s efforts to criminalize lawful business conduct. Every executive in America should be horrified,” a spokesperson for Milton’s legal team said.
The Securities and Exchange Commission Thursday also filed civil securities-fraud charges against him.