Prosecutors alleged in court records just two weeks ago that fraud committed by Trevor Milton, the creator of once-hyped electric-truck company Nikola Corp., cost retail investors hundreds of millions of dollars.
Then late Thursday Milton declared he had been forgiven by President Donald Trump. Friday a White House official confirmed the pardon.
Milton was found guilty in 2022 of lying about the technological innovations at EV business Nikola (NKLAQ) while he was chief executive, therefore cheating investors. First discovered by the short-selling company Hindenburg Research, most memorably a prototype electric vehicle was rolled down a slope to create the impression of it running.
Prototypes provided to investors either didn’t work or were Frankenstein’s monsters stitched together from bits of other cars, according to prosecutors. Some protests claimed that secret wall sockets drove the trucks.
Milton had appealed even though his punishment was four years in prison in late 2023. The attorney managing his appeal is Brad Bondi, the brother of U.S. Attorney General Pam Bondi. Someone acquainted with the matter reported Brad Bondi had not participated in Milton’s pardon application.
Filings with the Federal Election Commission show Milton greatly increased his election donations in the 2024 campaign as compared to previous years.
Milton gave millions of dollars to around 100 state Republican parties as well as to Republican politicians’ campaigns and organizations.
Among other things, that included a $920,000 donation to the Trump 47 Committee, a joint fundraising committee supporting state parties, Trump’s presidential campaign, and the Republican National Committee. Milton also gave to Robert F. Kennedy Jr.’s presidential campaign, now the secretary of health and human services.
An FEC file indicates that Texas Republican Sen. Ted Cruz refunded Milton’s $3,300 gift.
Trump claimed he knew little about the case in comments at the White House, although he mentioned Milton had been a fan.
“I don’t know him, but they say it was very unfair; the thing he did wrong was he was among the first people that supported a gentleman named Donald Trump for president,” Trump said to reporters.
Earlier this month, Matthew Podolsky, the acting U.S. attorney for the Southern District of New York, filed a petition seeking the court to mandate Milton to pay retail investors $656 million in restitution.
“The Court’s punishment included an order of repayment, but it postponed deciding a figure until after further party information was obtained. The parties tried to work out a settlement for the reparation matter, but they couldn’t agree,” Podolsky said.
Based on trade between Sept. 10, 2020 – when Hindenburg Research initially claimed fraud at Nikola – and Sept. 21 of that year, Milton resigned from Nikola, the reparation number was determined by computations made by Compass Lexicon, a consulting business.
Retail consumers who traded through TD Ameritrade, Charles Schwab (SCHW), and Robinhood (HOOD) lost a total of $268 million, according to the consulting firm; extrapolated from there the loss for other retail investors.
Milton contended in the filing that the loss was zero.
Edgardo Ramos, the judge reviewing the matter, had not yet decided on what reparation, if any, Milton would be obliged to pay. Milton’s pardon now closes the matter so that no compensation can now be demanded.
Nikola warned it was running low of money, then filed for Chapter 11 bankruptcy protection in February.
Milton on Thursday shared on social media his pardon video.
“What’s going on, guys? Oh my dear,” he remarked. “The US president called me on my phone and signed my complete and unreserved pardon of innocence on my phone. I am not free.
Milton equated his situation with that of the president, who has also had legal problems. “Done by the same offices who harassed and prosecuted him,” he remarked.
Milton also said he might not be suited for the corporate environment. “The best comeback tale in America is about to happen,” he remarked.
