The founder and former CEO of Nikola was sentenced to prison and issued hefty fine for misleading investors with a staged video of an electric semi truck rolling down a hill.
On Monday, December 18, Nikola founder Trevor Milton, 41, was sentenced to four years in prison. He was also issued a $1 million fine.
The prosecution asked for an eleven year prison sentence for Milton.
Milton was found guilty of one count of securities fraud and two counts of wire fraud in October 2022.
Milton will remain free on bail while he appeals the conviction, according to Reuters.
Prosecutors have argued that Milton “engaged in a fraudulent scheme to deceive retail investors about Nikola’s products, technical advancements, and commercial prospects for his own personal benefit in violation of the federal securities laws.”
Specifically, prosecutors pointed to an infamous video used to promote the Nikola One semi truck prototype that falsely claimed that the electric truck was fully functional and operating under its own power when in actuality, the truck was filmed rolling down a hill.
From a 2021 complaint filed against Milton by the U.S. Securities and Exchange Commission:
“For the commercial shoot, the non-functioning Nikola One prototype truck was hauled to the shooting location by a lowboy semi-truck trailer. At this time, and more than a year after the unveiling event, the Nikola One still could not run under its own power. It was towed to the top of an inclined stretch of road and then filmed rolling down the incline. This towing-and-rolling process was repeated three times to have sufficient footage for Company 1’s commercial.“
Court documents claimed that the video clip was sped up and edited, then shared to Nikola’s Twitter account with the caption “Behold, the Nikola One in motion. Pre-production units to hit fleets in 2019 for testing. The Nikola Hydrogen Electric trucks will take on any semi-truck and outperform them in every category: weight, acceleration, stopping, safety and features – all with 500-1,000 mile range!”