Who is Trevor Milton, the Nikola founder accused of sexual assault?
Nikola founder Trevor Milton’s star has fallen even faster than it rose.
Less than a month ago, the 38-year-old billionaire and his electric-truck startup appeared poised to usher in the next generation of high-tech vehicles when he inked a $2 billion partnership with industry giant General Motors.
But just two days later, a little-known short-seller accused Milton of building the five-year-old company on a web of lies and fraud. Then came the allegations that he sexually assaulted two women — one of them his own cousin — when each of them were just 15 years old.
Milton has strenuously denied both sets of accusations. But he’s nevertheless fallen from his perch as Nikola’s chairman — and the company’s stock price as tumbled alongside him.
Here’s a look inside the life and career of the latest high-tech superstar to be engulfed in a swirl of controversy.
Trevor Milton’s life and career
Milton was born in Utah to Bill Milton, a retired Union Pacific Railroad manager, and Sally Milton, a realtor who died of cancer when he was a teenager. A 2019 Forbes profile described Milton as a “lifelong garage tinkerer” who developed an obsession with how things worked at a young age.
Milton once recalled to Trucks.com how a lesson he learned from a railroad engineer when he was six planted the idea for Nikola in his mind. The engineer told him how locomotive trains were powered by electricity pumped out by their diesel engines and pointed to a truck running on a nearby highway.
“He told me that maybe one day they’ll be smart enough to build a locomotive semi-truck, and that was my lightbulb,” Milton told Trucks.com. “I decided right then that someday I’d build that locomotive semi. The next 30 years were all about preparing myself.”
Milton, a Mormon, reportedly gave college a try before dropping out after less than six months and spent 18 months on a mission to Brazil after high school. He became a sort of serial entrepreneur after landing back in Utah in 2003, when he started an alarm-and-surveillance company that he later sold before making a foray into online retail, according to Trucks.com.
In 2010, Milton founded dHybrid Systems, a company that designed natural-gas truck fueling systems that was bought in 2014 by metals manufacturer Worthington Industries, Forbes reported. The following year he started Nikola, which has designed semi trucks powered by batteries and hydrogen fuel cells, along with the Badger pickup truck that was unveiled in February.
Milton served as Phoenix-based Nikola’s CEO until June, when he handed the reins to Mark Russell — who previously worked at Worthington — and took the post of executive chairman, a job he left last week.
Fraud, assault allegations
Nikola appeared headed for a bright future on Sept. 8, when it announced a $2 billion partnership with GM that would see the Detroit automaker take an 11 percent stake the company and manufacture the Badger pickup. But the buzz wouldn’t last long.
Two days later, on Sept. 10, short-selling investment firm Hindenburg Research released a scathing report calling Nikola an “intricate fraud.” The firm said it had gathered “extensive evidence — including recorded phone calls, text messages, private emails and behind-the-scenes photographs — detailing dozens of false statements” by Milton, whom it accused of lying about Nikola’s technology.
Among the allegations was that the company had staged a January 2018 video of its Nikola One semi truck by filming it rolling down a hill in neutral, not powered by its own engine.
Nikola denied Hindenburg’s claims and called the report “a hit job for short sale profit driven by greed.” Milton resigned as Nikola’s chairman on Sept. 21, saying “the focus should be on the company and its world-changing mission, not me.” Rumors swirled that day that Milton had been arrested, but they turned out to be false.
The same day, Milton’s cousin, Aubrey Ferrin Smith, posted a series of tweets accusing Milton of groping her after their grandfather’s funeral in 1999, when she was 15 and he was 17. CNBC confirmed her account and spoke with a second woman who said Milton penetrated her vagina with his fingers in 2004, when she was a 15-year-old office assistant at a security company he ran.
Both woman have reportedly filed formal complaints with police about the alleged abuse. But a spokesman for Milton has said he “strongly denies these false allegations.”
“At no point in his life has Mr. Milton ever engaged in any inappropriate physical contact with anyone,” the spokesman said Tuesday.
How Nikola’s stock responded
The GM deal and the controversies that followed sent Nikola’s shares on a wild ride. The stock price surged more than 40 percent after the GM deal was announced on Sept. 8 to close at $50.05 a share. But the Hindenburg allegations on Sept. 10 sent it on a freefall, and it closed the following trading day at $32.13.
The stock fell further in the wake of Milton’s resignation, a report that negotiations for some corporate partnerships had stalled, and finally the sexual assault allegations, which led the shares to close at $17.88 on Tuesday. They recovered Wednesday after Nikola said it’s still committed to its business plan, and were up another 16.1 percent at $23.79 as of 3:06 p.m. Thursday.
Amid the carnage, there was nevertheless consolation for Milton, who early last week got to keep more than 91.6 million Nikola shares under a separation agreement with the firm. His stake is currently worth more than $2.2 billion, based on Nikola’s closing share price of $24.11 on Thursday.
Latest tech scandal
Milton’s saga has drawn comparisons to Elizabeth Holmes, the onetime Silicon Valley wunderkind who founded Theranos, a medical startup that allegedly peddled inaccurate blood tests while claiming to have revolutionary technology.
Milton and Holmes, 36, are college dropouts of a similar age who developed reputations as visionaries armed with disruptive ideas. They also won high-profile alliances with major companies — Theranos had a deal to provide blood tests for Walgreens before it collapsed, while Nikola has its pending partnership with GM.
But there are some important differences between the two — namely that Milton has not been charged with any crime. Holmes is set to face a trial in March on federal charges that she and ex-Theranos executive Sunny Balwani used false claims to scam investors out of millions of dollars. Both have pleaded not guilty.
Additionally, Nikola is a publicly traded company, which means it has to disclose financial data and other information to investors and the public. Theranos was privately held, which allowed it to maintain a degree of secrecy.
Share this article:
Source: Read Full Article