Nikola agrees to pay $125 million to settle SEC charges the electric truck maker defrauded investors
Trevor Milton
Trevor Milton, Nikola’s co-founder and extinct CEO.

Isaac Sloan/Nikola

  • Nikola will pay $125 million to settle SEC costs that it defrauded merchants by deceptive them about its products. 
  • The SEC acknowledged the agreement follows its litigation in opposition to Nikola co-founder and extinct CEO Trevor Milton. 
  • Nikola shares rose following recordsdata of the settlement. 

Nikola stock rose Tuesday after the EV firm agreed to pay $125 million to the US Securities and Exchange Rate to settle costs it defrauded merchants by deceptive them about its products, enterprise prospects, and technical capabilities. 

The startup, which makes a speciality of battery-electric and hydrogen-electric semi trucks, acknowledged closing month it had space apart that quantity in anticipation of a doable settlement with the SEC.

Shares were up 3.6% to $9.58 in premarket commerce but catch fallen 39% on a yr-to-date basis. Nikola went public in June 2020 following a merger with a diversified cause acquisition firm.  

The SEC in an announcement Tuesday acknowledged the settlement follows its litigation filed in opposition to Trevor Milton, Nikola’s co-founder and extinct chief executive. The company acknowledged he embarked on a public relatives marketing campaign along side tweets and media appearances that became geared in the direction of inflating and declaring Nikola’s stock effect — sooner than a single industrial product had been made. 

Among its findings, the SEC acknowledged Milton misled merchants about Nikola’s technological advancements, truck reservations and orders, and financial outlook. It additionally acknowledged it chanced on Nikola additional misled merchants by misrepresenting or omitting subject matter facts about, amongst diversified things, the refueling time of its prototype autos. 

“Because the describe finds, Nikola Company is accountable each and each for Milton’s allegedly deceptive statements and for diversified alleged deceptions, all of which falsely portrayed the ultimate notify of the firm’s enterprise and abilities,” acknowledged Gurbir Grewal, director of the SEC’s enforcement division, in an announcement. “This misconduct — and the hurt it inflicted on retail merchants — merits the proper remedies today’s settlement gives.” 

Nikola in a separate assertion acknowledged beneath the terms of the choice that it neither admits nor denies the SEC’s findings and that the settlement resolves all authorities investigations. The firm will pay $125 million to the SEC in 5 installments over two years. The first installment would possibly be paid by the end of this yr and the rest installments would possibly be paid semiannually thru 2023. 

Nikola acknowledged this can proceed on its strategy of turning in trucks and building out its hydrogen infrastructure, along side dispensing stations.

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