Trevor Milton, Founder of Nikola, Sentenced to Four Years in Prison for Lying to Investors

New York—Trevor Milton, the convicted founder of electric- and hydrogen-powered truck maker Nikola, has been sentenced to four years in prison after being found guilty of lying to investors about the company’s technology. The sentencing comes after a jury last year determined that Milton misled investors by making false statements about Nikola’s products and achievements.

False Claims and Misleading Statements

Federal prosecutors in Manhattan argued that Milton deceived investors by claiming that Nikola had developed its own batteries and built a pickup truck from scratch, despite knowing that the company was purchasing these components. Additionally, he falsely claimed that Nikola had successfully created a functioning semi-truck called the “Nikola One,” when in reality, it did not work.

U.S. District Judge Edgar Ramos, after announcing the sentence at a hearing in federal court in Manhattan, emphasized that he believed the jury made the correct decision. He acknowledged that Milton was aware that the statements he made about the company were false.

Milton’s Appeal and Bail

Although Trevor Milton has been sentenced to four years in prison, Judge Ramos has allowed him to remain free on bail while he appeals his conviction. This decision grants Milton temporary freedom as he seeks to challenge the verdict.

Comparison to Elizabeth Holmes’ Case

Prosecutors had urged Judge Ramos to sentence Milton to around 11 years in prison, citing the case of Elizabeth Holmes, the founder of Theranos, who received a similar sentence for defrauding investors. However, Milton’s defense argued that his misstatements were a result of his unwavering optimism in his company and that his case differed from Holmes’ because her lies endangered people’s lives.

Milton’s Defense and Sentencing

Before the sentence was handed down, Milton spoke at length, discussing his family, rural upbringing, and quoting Bible verses. He maintained his innocence and expressed his desire to spend time with his wife, who is currently recovering from an illness. However, the judge rejected Milton’s explanation that his statements were made out of enthusiasm and not with the intention to harm investors. He emphasized that good intentions do not excuse fraudulent behavior.

Impact on Nikola and Investors

Trevor Milton was convicted in October 2022 on one count of securities fraud and two counts of wire fraud. Nikola, as a company, agreed to pay $125 million to settle civil charges brought by the U.S. Securities and Exchange Commission in 2021. The fallout from the scandal has significantly impacted Nikola’s stock price, which now trades for less than $1, a sharp decline from its peak of over $60 in June 2020.

By Jody Godoy