Trevor Milton, the founder of electric vehicle company Nikola, received a sentence of four years behind bars on Monday after making fraudulent claims about his company.
During a court appearance on Monday, Milton tried to show that he was honest and generous, yet an unsophisticated businessman at the same time. He said he came from a humble background that saw him milking cows, that he never graduated from college, and that he never meant to defraud people who invested in his company, which produced electric trucks.
During comments he made to Judge Edgardo Ramos at the sentencing hearing, Milton said:
“My intent was not to harm others. Let me have probation.”
The judge, though, didn’t agree with Milton’s suggestion that he avoid jail time altogether. Instead, Ramos sentenced Milton to spend four years behind bars as well as pay a fine of $1 million. In addition, he must pay restitution to the victims of his crime, plus forfeit a ranch that he purchased with the gains that he earned illegally.
Milton had previously been convicted of securities fraud and wire fraud. Prosecutors said that he embellished how successful his company was in an attempt to deceive everyday investors. Combined, those investors lost in excess of $660 million on his company, prosecutors said.
The Badger, which was one pickup truck model that Nikola produced, didn’t have some parts, including an HVAC system that worked and airbags. In addition, prosecutors say that the lights on the interior of the vehicle didn’t operate but were rather backlit to make it look like they did.
Prosecutors said that the business practices Milton carried out were a “sustained scheme to take advantage of individual, non-professional investors” so that his company’s stock price would go up, and he himself would become rich as a result.
As prosecutors described:
“Milton over and over again exaggerated or outright lied about Nikola’s success in a way that misled investors about the risks and likely returns of their investments.”
Milton’s lawyers tried to argue that investors didn’t lose any money in Nikola, which is why they requested that their client receive a sentence that was void of jail time.
The original indictment was handed down against him back in July of 2021. Prosecutors accused him of preying on retail investors, who are typically vulnerable to influence. These investors were particularly vulnerable in this case, though, since many of them were trying out trading after they lost a lot of their income because of the COVID-19 pandemic.
Prosecutors alleged that some of the victims lost all of their savings for retirement.
They further said that Milton’s company created a website where they made many false promises about producing a truck that ran on electric power completely, even though the vehicle never was operable.
It’s been a challenging week for electric vehicle makers. In addition to Milton’s jail sentence, Tesla recalled nearly every one of its vehicles on the road to make an update to its self-driving technology.