Latest News

The Wall Street Journal: Nikola founder’s securities-fraud trial set to start this week

0

Trevor Milton, the Nikola Corp. founder who enticed auto-industry leaders and investors with his promise for a revolution in electric trucks, faces a securities-fraud trial beginning this week on allegations that he lied about his company’s development of environmentally friendly technology.

Federal prosecutors in Manhattan last year accused Milton of running a scheme to enrich himself and boost his stature as an entrepreneur by falsely hyping Nikola’s
NKLA,
+3.24%

prospects and duping nonprofessional investors, including stock-market novices. He was indicted on two counts of wire fraud and two counts of securities fraud. Jury selection begins Monday.

“In order to drive investor demand for Nikola stock, Milton lied about nearly every aspect of the business,” then-U.S. Attorney Audrey Strauss said when announcing the charges.

Milton, who is 40 years old, has pleaded not guilty. He resigned from Nikola in 2020, several days after short seller Hindenburg Research released a report alleging dozens of misrepresentations that Milton had made about the business, including rolling an undrivable truck down a hill to make it appear functional in a marketing video.

During a pretrial hearing last week, lawyers for Milton said they would argue their client acted in good faith and didn’t intend to defraud anyone. Milton might have used certain terms like “prototype,” “functional,” and “show car” differently than some investors understood them, defense lawyer Marc Mukasey said. “There is a linguistics aspect to this,” Mukasey said.

An expanded version of this report appears in WSJ.com.

Also popular on WSJ.com:

How much can you spend in retirement? Answer these questions first.

Outlook for tech stocks darkens after rocky stretch.

The Wall Street Journal: Activist investor Dan Loeb steps back from his push for Disney to sell ESPN

Previous article

Market Snapshot: Stock-market wild card: What investors need to know as Fed shrinks balance sheet at faster pace

Next article

You may also like

Comments

Leave a reply

Your email address will not be published.

More in Latest News