Trevor Milton, the disgraced founder of Nikola, has been sentenced to four years in prison on three counts of fraud. Following a jury’s verdict in October 2022, which found Milton guilty of one count of securities fraud and two counts of wire fraud, he faced a potential maximum sentence of 60 years in prison. Prosecutors had requested an 11-year prison term and a $5 million fine, while the defense argued for probation.
U.S. District Judge Edgar Ramos, who announced the sentence at a federal court hearing in New York City, directly addressed Milton, stating, “As difficult as it may be for you or your family to hear, I believe the jury got it right,” as reported by Reuters.
Before the sentencing, Milton spoke to the court, asserting, “I did not intend to harm anyone, and I did not commit those crimes levied against me.” He also delved into details about his rural upbringing and recited biblical verses.
Prosecutors asserted that Trevor Milton artificially inflated the value of Nikola’s stock by deceiving investors with false information about “nearly all aspects” of the company’s business. One major allegation was Milton’s claim of having a fully functional electric truck, supported by a video depicting a Nikola One prototype seemingly moving on its own. However, an indictment contended that the truck was rolling down a hill, and Milton was allegedly involved in creating the misleading video.
Furthermore, Milton faced accusations of fabricating statements about Nikola’s substantial pre-order reservations, falsely representing the cost-effectiveness of hydrogen fuel production, and making misleading claims about the development of groundbreaking battery technology. The prosecution argued that these actions contributed to a false and inflated perception of Nikola’s capabilities and prospects, ultimately misleading investors.
Nikola remains operational and has plans to resume deliveries of its battery electric truck in early 2024, having addressed battery issues that led to a recall, incurring a cost of approximately $61.8 million. Despite the setback, Nikola produced 96 trucks and shipped 79 in the nine months leading up to September 30.
However, the company’s stock price has seen a staggering 99 percent drop since 2020, resulting in substantial losses for investors, estimated to be over $660 million. Trevor Milton, the founder of Nikola, who sold about $100 million of his Nikola stock in 2020, reportedly spent most of the proceeds on luxury items like a plane and real estate, as per The New York Times.
Following his conviction, Milton is expected to appeal the decision. He had already requested a new trial from U.S. District Judge Edgar Ramos after the jury delivered a guilty verdict. The legal proceedings and financial challenges have significantly impacted Nikola’s standing in the market and among investors.
