Nikola founder Trevor Milton quits as company chairman amid fraud probes

Nikola founder Trevor Milton steps down as executive chairman in short-seller claims row

Nikola founder Trevor Milton steps down after allegations of fraud

Brokerage J.P.Morgan noted that Milton's resignation could weigh on some of the partner and customer relationships that he had forged, but said Girsky is better suited to the role as Nikola moves on to its next phase. By late Monday morning, Milton had made his Twitter account private, but his LinkedIn account remained public and active. In June, Bloomberg reported that Mr Milton exaggerated the capabilities of the company's debut truck, Nikola One - purportedly a fuel-cell vehicle it never produced or brought to market.

But two days later, investment company Hindenburg Research published a report accusing the startup of "intricate fraud" based on multiple lies by Milton, who it said "misled partners into signing agreements by falsely claiming to have extensive proprietary technology". Trevor Milton, who also served as the executive chair, stepped down Monday while promising to defend himself against the "false allegations", reports NBC News. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Nikola's management and are not predictions of actual performance.

Despite the allegations, General Motors has gone ahead with the strategic partnership with Nikola Motor, seen as an innovator, and will own an 80 per cent stake in the company.

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Nikola shareholder and Italian vehicle equipment maker CNH Industrial declined to comment, while Germany's Robert Bosch, a supplier and investor, said it meant to continue working with the company.

Nikola issued a more detailed statement four days after Hindenburg's report on September 14, though some of the company's responses were more counterarguments than rebuttals.

"These allegations by the short seller are false and misleading and created to manipulate the market to profit from a manufactured decline in Nikola's stock price", Nikola said, following Hindenburg Research's report.

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Nikola has rejected all the accusations and threatened to take legal action against Hindenburg.

Milton, like Tesla Inc.

Mr Milton, like Tesla chief executive officer Elon Musk, has relied on social media to promote his company. Potential buyers paid deposits as high as US$5,000 - without even seeing a prototype of a vehicle that won't go on sale until 2022.

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Shares of electric-truck maker Nikola Corp tumbled as much as 30% on Monday after founder Trevor Milton stepped down following claims of nepotism and fraud by a Wall Street short-seller that have drawn interest from US regulators. It plans to build a battery electric semi-truck with CNH Industrial's Iveco at a facility in Ulm, Germany, by the end of next year. A fuel-cell-powered semi truck is planned for 2023 that will be built at Nikola's factory in Coolidge, Ariz. GM will be the supplier for the fuel cells, provide access to its battery technology and manufacture and engineer the Nikola Badger.

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