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Billionaire founder of electric truck manufacturer Nikola charged with fraud

NEW YORK — Federal prosecutors in Manhattan on Thursday charged Trevor Milton, the billionaire founder of electric truck manufacturer Nikola, with securities and wire fraud.

Authorities had been investigating Milton and Nikola for more than a year after short seller Hindenburg Research called Nikola an “intricate fraud” in a September report.

The company subsequently conceded video of its electric truck that gave a misleading impression it was actually drivable.

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The company also said Milton had made inaccurate statements about the technology behind the vehicle.

“Milton’s scheme targeted individual, non-professional investors, so-called retail investors, by making false and misleading statements,” the indictment said.

Phoenix-based Nikola planned to build battery- and hydrogen-fuel-cell-powered heavy trucks for long-haul trucking, and the company had been valued at more than $12 billion.

The doubts raised by short sellers and regulators have tanked the stock price and scuttled a deal with General Motors to take a stake in the company.

Prosecutors said Milton lied at every turn about the company’s ability to produce its electric truck.

According to the indictment, Milton made false and misleading statements about the company’s success in creating a fully-functioning semi-truck prototype known as Nikola One when he knew that the prototype was inoperable.

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He also allegedly made false statements about an electric- and hydrogen-powered pickup truck known as the Badger using Nikola’s parts and technology when he knew that was not true.

“As a result, some of the retail investors that Milton’s fraudulent scheme targeted suffered tens and even hundreds of thousands of dollars in losses, including, in certain cases, the loss of their retirement savings or funds that they had borrowed to invest in Nikola,” prosecutors said.

Milton resigned from Nikola in September amid allegations of fraud. At the time, he said he would defend himself against accusations that the company made false claims about its vehicles, allegations Nikola rejects.

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