Dec 21, 2021 - Economy

Nikola pays $125M to settle SEC fraud allegations

The former CEO of Nikola, Trevor Milton, wearing a gray suit, purple tie and white shirt, walks near a courthouse with a lawyer at his side.

Trevor Milton. Photo: Angus Mordant/Bloomberg via Getty Images

Hydrogen-electric truck startup Nikola agreed to pay $125 million in a deal with the SEC after the agency accused the company's founder of misleading the public.

Driving the news: The SEC announced the settlement Tuesday but said it would continue its investigation, which has already led to fraud charges against former Nikola boss Trevor Milton.

  • Milton misled investors about Nikola's technology, production capacity, reservations and finances, the SEC alleged. Nikola did not acknowledge wrongdoing but agreed to continue to cooperate with the probe.
  • The money will be distributed to "victim investors," the SEC said.
  • Nikola confirmed the deal and said it's "taken action to seek reimbursement" from Milton, who pleaded not guilty to the SEC's charges.

The bottom line: The accusations against Milton dealt a severe setback to Nikola, but it did not lead to the company's collapse. Nikola still has a shot at delivering the hydrogen-electric technology it's promised.

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