Nikola founder convicted of $1B fraud over social media misrepresentations News
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Nikola founder convicted of $1B fraud over social media misrepresentations

Trevor Milton, founder of automotive manufacturer Nikola Corp., on Friday was convicted of fraud following his misrepresentations and lies regarding the company’s technology.

Milton made multiple representations regarding the technologies of his zero-emissions trucking business. Alongside other issues, a jury found that he lied about the costs of using hydrogen fuel as energy which he claimed to have been producing at a quarter of market price. In a press release of the indictment from 2021, the US Attorney’s Office for the Southern District of New York stated:

Milton’s scheme targeted individual, non-professional investors–so-called “retail investors”–by making false and misleading statements directly to the investing public through social media and television, print, and podcast interviews.

In 2021, there was reportedly $770 million in losses from social media fraud. 37 percent of those losses came from investment scams, an issue which has been recently exacerbated by parts of the cryptocurrency market. With the growing issue of online fraud, US Attorney Damian Williams made clear this case was also intended to serve as a deterrence against future offenders. He stated it was “fraud, plain and simple, and this Office has no patience for it. Never has, never will. Let this case serve as a warning.”

Nikola had previously reached a $125 million settlement with the US Securities and Exchange Commission (SEC) last December. The SEC charged the company with violating securities laws by defrauding investors with false claims about the company’s products and technologies.