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The founder of Nikola, a new force in American car building, faces 11 years in prison on suspicion of securities fraud.

2024-05-23 Update From: SLTechnology News&Howtos shulou NAV: SLTechnology News&Howtos > IT Information >

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Shulou(Shulou.com)12/24 Report--

CTOnews.com, December 13 (Xinhua)-- US prosecutors have recommended that Trevor Milton, founder and former CEO of Nikola, a new force in US car building, be sentenced to 11 years in prison after he was found guilty of defrauding investors.

In October last year, Milton was convicted of two counts of wire fraud and one count of securities fraud. In 2020, Milton showed investors a video of Nicholas One electric semi-trailer, but it was later discovered that the vehicle was not self-powered. Just a few months ago, he was ordered to pay Nikolai $165 million (CTOnews.com Note: currently about 1.185 billion yuan) in compensation.

Prosecutors on Tuesday asked U.S. District Judge Edgardo Ramos (Edgardo Ramos) to impose a "heavy sentence" on Milton, echoing the 11-year sentence recommended by the probation department, Reuters reported. They also said Milton's misrepresentation of investors began as early as 2019, long before Nikolai's market capitalization exceeded $30 billion in June 2020.

Prosecutors compared Milton to Elizabeth Holmes, founder of Theranos, a blood test start-up, who was sentenced to more than 11 years in prison for fraudulent investors. "just as Holmes lied about the blood analyzer made by Theranos, Milton lied about the operability of Nikolai's One semi-trailer," prosecutors said.

Milton thought he was different from Holmes, calling Nikolai Motors a "real company with real products," while Theranos didn't. He also asked for probation, adding that the comments stem only from his "deep optimism" about the truckmaker.

Prosecutors also said Milton used news interviews and social media to spread false information, including false information related to Nikola One, as well as other claims that he made electric and hydrogen-powered Badger pickups "from scratch."

It is worth noting that Milton resigned from the new power as early as September 2020 and was later found guilty of fraud.

Milton is scheduled to be sentenced on December 18, before which a hearing will be held to allow investors to make statements about their losses as a result of fraudulent statements.

Data show that in the third quarter of this year, Nikola delivered only three trucks, compared with 63 in the same period last year. In the first three quarters of this year, the company's truck production fell to 96 from 125 in the same period last year, while delivery fell from 111 to 79.

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