U.S. jury convicts Nikola founder of fraud

NEW YORK, Oct 14 (Reuters) – Nikola Corp (NKLA.O) founder Trevor Milton on Friday was convicted by a U.S. jury of fraud over allegations he lied to buyers concerning the electrical car firm’s know-how.

The jury discovered Milton responsible on one rely of securities fraud and two counts of wire fraud after deliberating for round 5 hours. Milton was acquitted on an extra rely of securities fraud.

Through the trial in federal court docket in Manhattan, prosecutors depicted Milton, 40, as a “con man” who sought to deceive buyers concerning the electric- and hydrogen-powered truck maker’s know-how beginning in November 2019.

Milton, sporting a blue swimsuit and inexperienced tie, shook his head because the jurors confirmed their verdict. His lawyer stated he’ll file court docket papers difficult the decision.

Milton, of Oakley, Utah, was indicted in July 2021. He left Nikola in September 2020 after a report by quick vendor Hindenburg Analysis referred to as the corporate a “fraud.”

Prosecutors accused Milton of utilizing social media and interviews on tv, podcasts and in print to make false and deceptive claims about Nikola’s vehicles and know-how.

They stated Milton’s improper statements included that Nikola constructed an electric- and hydrogen-powered “Badger” pickup from the “floor up,” developed batteries in-house that he knew it was buying elsewhere and had early success in making a “Nikola One” semi-truck he knew didn’t work.

Milton made the statements about Nikola because it joined the mounting variety of tech and EV corporations going public by way of particular function acquisition autos or SPACs. He additionally was accused of defrauding the vendor of a Utah ranch, who accepted Nikola inventory choices as a part of the acquisition worth primarily based on Milton’s claims concerning the firm.

The protection and the prosecution delivered closing arguments to the jury on Thursday in a trial that started on Sept. 13. The prosecution stated Milton was obsessive about the corporate’s inventory worth and made the statements to inflate it and his personal web price. The protection stated prosecutors had distorted Milton’s statements about Nikola’s plans to shake up the automotive business.

Nikola stated in an announcement after Milton’s conviction that it was “happy to shut this chapter” and stated it can proceed to work in the direction of creating worth for shareholders.

The corporate agreed final yr to pay $125 million to settle with the U.S. Securities and Trade Fee’s over its representations to buyers.

Reporting by Jody Godoy in New York; Enhancing by Will Dunham, Jonathan Oatis and Grant McCool

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