Truck maker Nikola's founder resigns over fraud allegations, says focus should be company

Trevor Milton, the founder and executive chairman of embattled truck maker Nikola had resigned following allegations of fraud. The news of his resignation was made public by the company in a statement wherein it also revealed that Stephen Girsky, a board member and former vice chairman at General Motors would replace Milton.

Announcing his resignation, Milton in a statement said, “The focus should be on the Company and its world-changing mission, not me. I intend to defend myself against false allegations levelled against me by outside detractors.”

Founded by Milton in 2015 to develop trucks and pick-ups powered by electric batteries or hydrogen fuel cells, Nikola has not yet built anything but caught attention by signing strategic partnerships with renowned groups as GM and German engineering giant Bosch. The announcement fo partnering with GM, shot up the company’s share by 41 per cent on the New York Stock Exchange.  But only two days later,  investment company Hindenburg Research published a report accusing the Nikola 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."

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Denies 'most' allegations

Soon after the accusation, the shares of the company plummetted 36 percent in three days. In addtion, it also sparked an investigation by the Securities and Exchange Commission, according to sources cited by Bloomberg. As of now, Nikola had denied "most" of the calims. 

Earlier this month, it was reported by Associated Press that GM would take an 11% ownership stake in the Phoenix company and would engineer and build Nikola’s Badger hydrogen fuel cell and electric pickup truck. The Badger is expected to be in production by the end of 2022. GM was also supposed to help with cost reductions for Nikola's other vehicles including heavy trucks, and the company will use GM's battery system and hydrogen fuel technology.

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