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Tuesday, April 23, 2024

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Nikola Founder, Trevor Milton, Sentenced to Four Years in Prison for Securities and Wire Fraud

Trevor Milton, the founder of electric- and hydrogen-powered truck manufacturer Nikola, has been sentenced to four years in prison following his conviction on charges of securities and wire fraud. The sentencing comes after a jury found him guilty of deceiving investors about Nikola’s technology. Federal prosecutors argued that Milton misled investors by making false claims about the company’s capabilities, including statements about developing a pickup “from the ground up” and creating its own batteries. The sentencing judge emphasized that he believed the jury’s decision was correct, asserting that Milton was aware his statements were false.

Milton’s conviction stems from his actions in overstating Nikola’s achievements, such as falsely claiming early success with the “Nikola One” semi-truck that he knew did not work. Prosecutors had sought a sentence of around 11 years, aligning with the punishment received by Elizabeth Holmes, the founder of Theranos, who was found guilty of defrauding investors in her blood-testing startup. Despite facing a prison term, Milton’s defense argued for probation, attributing any misstatements to his “deeply-held optimism” about Nikola. Milton expressed his intention to appeal the conviction.

Nikola itself faced legal consequences, agreeing in 2021 to a $125 million settlement with the Securities and Exchange Commission to resolve civil charges. The company’s shares, which peaked at over $60 in June 2020, currently trade for less than $1. The downfall of Nikola and the legal scrutiny surrounding its founder highlight the challenges and consequences associated with misleading claims in the competitive electric vehicle and clean energy sector.

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Ruben Jay
Ruben Jay
Ruben Jay is an American broadcaster, media blogger, and podcast host. Currently, Ruben is the President of MultiMediaMouth.com and the executive producer and host of the popular podcasts You’re My Best Friend and ON AIR with Ruben Jay, exclusively on MultiMediaMouth.com. Follow Ruben on Instagram, Twitter, and Tiktok @TheRubenJay.

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