Trevor Milton, founding father of Nikola Corp., exits court docket in New York, US, on Monday, Sept. 12, 2022.
Stephen Yang | Bloomberg | Getty Photographs
Nikola Founder Trevor Milton is about to be sentenced Monday in a New York courtroom on three expenses associated to defrauding buyers of the embattled electric- and hydrogen-powered truck maker.
Milton was discovered responsible in October 2022 on two counts of wire fraud and one depend of securities fraud. He faces as much as 60 years in jail. Nevertheless, prosecutors in New York final week really useful a sentence of 11 years imprisonment.
Milton turned an overnight billionaire when he took Nikola public by means of a take care of a particular function acquisition firm in June 2020. The corporate was rapidly thought-about to be one of many most-promising EV startups – valued at its peak at greater than $30 billion – till allegations relating to false and misleading statements had been uncovered by short-seller Hindenburg Analysis.
Prosecutors on Tuesday in contrast Milton to disgraced Theranos founder Elizabeth Holmes, who was sentenced to more than 11 years in jail final yr for defrauding buyers in her blood testing startup.
“Simply as Holmes lied about Theranos-manufactured blood analyzers, Milton lied concerning the operability of the Nikola One semitruck,” prosecutors wrote to U.S. District Choose Edgardo Ramos, who will determine Milton’s sentencing.
Milton has tried to differentiate himself from Holmes, whose firm was personal. He argues “that Nikola remains to be an actual enterprise, whereas Theranos shouldn’t be,” based on court docket paperwork.
Milton, who was the corporate’s largest shareholder, stepped down as govt chairman of Nikola in September 2020. He did so amid an inner probe after the Hindenburg report, which characterised the corporate as a home of playing cards constructed by Milton.
Since Milton’s resignation, shares of Nikola have crated and the corporate has didn’t retain executives. Nikola Chairman Stephen Girsky, whose SPAC introduced the corporate public, was named CEO in August.
Shares of Nikola have just lately traded underneath $1, with a market worth of about $327 million.
Nikola was among the many first closely publicized corporations to go public by means of a SPAC. It impressed a whole bunch of different startups to do the identical earlier than the Securities and Alternate Fee cracked down on the practice.
SPACs are publicly traded corporations that do not have any actual property aside from money. They’re shaped as funding autos with the only real function of elevating funds after which discovering and merging with a privately held firm.
This can be a growing story. Please examine again for added updates.
