Nikola scam: Electric-truck prototypes were towed into position and rolled down hill

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The founder of the much-hyped electric truck manufacturer Nikola Corp. NKLA, -11.00% has been charged with lying to investors about the supposed technological breakthroughs the company had achieved in order to drive up its stock price, federal prosecutors announced Thursday.

Trevor Milton, 39, is accused of claiming that his company had successfully manufactured working prototypes of electric trucks and pickup trucks that would turn the industry on its head, when he had, in fact, never built anything.

“At the bottom, this a very simple case: Milton told lies to generate popular demand for his stock,” said Audrey Strauss,, the U.S. Attorney for the Southern District of New York.

In the indictment, federal prosecutors said Milton had for years overinflated the technological developments the company had achieved, claiming it had built working prototypes of its Nikola One truck and Badger pickup truck out of parts the company had fully manufactured on its own.

Prosecutors said that, in fact, the prototypes that had been unveiled didn’t function and were Frankenstein monsters cobbled together from parts from other vehicles. At public events, the vehicles were towed into position and were powered by plugs leading from hidden wall sockets.

In one instance, in which the vehicle was filmed for a promotional film, tape was used to keep the doors of a truck prototype from opening, prosecutors said. To make it appear the truck was driving, it was towed to the top of a hill and then rolled down to the bottom, according to the indictment.

Milton allegedly repeatedly said publicly that the prototypes were fully operational and overstated the number of pre-orders the company had received.

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