Trevor Milton, the founder and former CEO of Nikola, a company working on electric and fuel cell trucks, was indicted today by a grand jury on three counts of criminal fraud over false claims he made about the company.

Milton became a billionaire after taking Nikola public through a SPAC deal, and the price of the stock shot up as the CEO made several claims about the company’s progress toward bringing its electric and fuel cell trucks to market.

Last year, Nikola was in hot water after a report from Hindenburg Research made several allegations exposing deception by Nikola and its founder Trevor Milton, including several claims corroborated in previous reports from Electrek and Bloomberg.

Nikola issued a response to those claims, but as we reported, the response lacked any rebuttal of the main allegations of deception by the company and its founder, Milton.

For the most damning one, the claim that it faked the first video of its hydrogen truck driving, the company even admitted to it without issuing an apology and instead claimed its deception was fine due to a technicality.

Milton ended up leaving the company as the pressure started to increase.

The founder has been rumored to be under federal investigation for fraud since Nikola has been exposed in September 2020.

After Milton left the company, he sold millions worth of stock, which he used to buy a lavish mansion in Utah, and still held a significant amount, often worth in the billions of dollars depending on the fluctuating stock price.

The company continued to run into issues.

GM canceled a deal to build Nikola’s electric-hydrogen Badger pickup truck, and the company ended up refunding the deposits to reservation holders.

Now, Milton has to face the music as the US Attorney’s Office in the Southern District of New York has announced that it is charging him with three counts of criminal fraud in a press conference today:

The prosecutors noted the indictment:

Milton’s scheme targeted individual, non-professional investors — so-called retail investors — by making false and misleading statements directly to the investing public through social media, and television, print and podcast interviews.

According to the US Attorney’s Office, Milton has surrendered to the authorities, and he should appear in court later today.

The US attorney said that Milton specifically lied by exaggerating Nikola’s battery and hydrogen technology, the level of engineering that the company completed on prototypes, and the number of orders it secured.

The prosecutors argued that the motive for the fraudulent claims was “to enrich himself and elevate his stature as an entrepreneur.”

Milton stands to forfeit all property linked to the fraud, which would include all of his Nikola stocks and the money received from the sale of those stocks, which represents most of his fortune.

Update: Milton has now appeared in court, pleaded not guilty, and was released on a $100 million bond. The accused fraudster’s legal team released a statement in which they claim Milton is the victim of a botched investigation targeting green technology and entrepreneurship. It’s a hilarious statement:

“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,” the spokesperson said. “Mr. Milton has been wrongfully accused following a faulty and incomplete investigation in which the government ignored critical evidence and failed to interview important witnesses.”

To be clear, both Nikola and Milton had almost a year to explain the deceptive comments, and they never did. Nikola even admitted that Milton made false statements.

Electrek’s Take

My kneejerk reaction to this news was: “Ha! You get what you deserve.” But honestly, it came more from a selfish standpoint, as I had my issues with Milton.

I’ve been critical of Nikola over the years, and Milton went around badmouthing me, claiming that the only reason I was critical of the company was because I was “a shill for Elon Musk.”

When he went on the Tesla Third Row podcast, he even “bonded” with Omar Qazi, a Tesla superfan known for making false claims, over how they thought I am a “douche”:

If I take a step back from my personal issues with Milton and think more rationally about his indictment and, hopefully, him being found guilty, I think it will be positive for the EV investment space.

While he hasn’t been found guilty, this is a step in the right direction, and ultimately, it will be good for the electric vehicle industry.

The EV SPAC frenzy has created a very noisy investment space for electric vehicle ventures, and that attracts fraudsters.

The space is now full of companies making grand claims, and people are now going to be more careful about which companies to take seriously, and those companies are going to be more careful about the claims they make knowing that there are repercussions.

But I also see people lumping all EV SPAC companies in the same “fraud basket,” and I don’t think that’s fair either.

There are several legit EV companies who were just opportunistic in raising money through SPAC deals.

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