Trevor Melton, founder and former president of the electric car maker, must stand trial for fraud.
The basics in brief
- The former head of the company provided false information about the products.
According to the New York Attorney General’s Office, the 49-page indictment includes three counts of fraud — including from investors who lost a lot of money due to misinformation about the company’s listed products.
Nikola was founded in 2015. Since then, the Milton team has been working on alternative driving technologies for trucks and large SUVs. In the future, these will run on the basis of electric batteries and hydrogen fuel cells. The startup has also worked on charging stations for hydrogen trucks.
The plans remained largely theoretical. Milton is now accused, according to Thursday, among other things, of declaring that Nikola built a prototype semi-trailer truck that was “fully working” – but at the same time Milton knew exactly that it was “not working”. The claim is that he specifically wanted to induce investors to buy shares with his statements.
Melton resigned after allegations of fraud against the company last September. The investment firm Hindenburg Research had previously charged Nicola with “complex fraud” based on multiple lies from Milton. The company said the business partners are being “misled” by “falsely claiming they have important technologies,” among other things.
The indictment says the investors lost “tens of thousands and sometimes hundreds of thousands of dollars” through Milton’s fraud. The company’s stock lost 7.5 percent in the pre-trading period.
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