Convicted of bilking investors, Nikola founder and Trump donor gets a presidential pardon

Trevor Milton, left, leaves the Thurgood Marshall United States Courthouse on Monday, Sept. 12, 2022, in New York. (AP Photo/Brittainy Newman, File)

Trevor Milton, the founder of electric vehicle start-up Nikola who was sentenced to prison last year for fraud, was pardoned by U.S. President Donald Trump, the White House confirmed Friday.

The pardon of Milton, who was sentenced to four years in prison for exaggerating the potential of his technology, could wipe out hundreds of millions of dollars in restitution that prosecutors were seeking for defrauded investors.

Milton, 42, and his wife donated more than $1.8 million to a Trump re-election campaign fund less than a month before the November election, according to the Federal Election Commission.

At Milton’s trial, prosecutors say a company video of a prototype truck appearing to be driven down a desert highway was actually a video of a nonfunctioning Nikola that had been rolled down a hill.

Milton had not been incarcerated pending an appeal.

Milton said late Thursday on social media that he had been pardoned by Trump.

“I am incredibly grateful to President Trump for his courage in standing up for what is right and for granting me this sacred pardon of innocence,” Milton said.

The White House confirmed the pardon Friday, though there was no notice of a pardon on the White House website.

When asked by a reporter in a news conference Friday why he pardoned Milton, Trump said it was “highly recommended by many people.” Trump suggested that Milton was prosecuted because he supported the president.

“They say the thing that he did wrong was he was one of the first people that supported a gentleman named Donald Trump for president,” Trump said.

Trump went on to say that Milton “did nothing wrong” and that the Southern District of New York’s prosecutors were “a vicious group of people.”

During his securities fraud case, Milton was defended by two lawyers with connections to Trump: Marc Mukasey, who has represented the Trump Organization; and Brad Bondi, the brother of Pam Bondi, who Trump appointed as U.S. Attorney General.

Also Friday, Trump commuted the sentence of Ozy Media co-founder Carlos Watson, just before he was due to report to prison for a nearly 10-year sentence in a financial conspiracy case.

Trump wasted little time in using his pardon power since beginning his second term. Hours after taking office, he wiped clean the records of roughly 1,500 people who participated in the Jan. 6, 2021, riot at the U.S. Capitol. The next day, Trump announced that he had pardoned Ross Ulbricht, the founder of Silk Road, an underground website for selling drugs.

Ulbricht had been sentenced to life in prison in 2015 after a high-profile prosecution that highlighted the role of the internet in illegal markets.

Nikola, which was a hot start-up and rising star on Wall Street before becoming enmeshed in scandal, filed for Chapter 11 bankruptcy protection in February.

Milton, convicted of fraud, was portrayed by prosecutors as a con man six years after he had founded the company in a basement in Utah.

Prosecutors said Milton falsely claimed to have built its own revolutionary truck that was actually a General Motors product with Nikola’s logo stamped onto it.

Called as a government witness, Nikola’s CEO testified that Milton “was prone to exaggeration” when pitching his venture to investors.

Milton resigned in 2020 amid reports of fraud that sent Nikola’s stock prices into a tailspin. Investors suffered heavy losses as reports questioned Milton’s claims that the company had already produced zero-emission 18-wheel trucks.

The company paid $125 million in 2021 to settle a civil case against it by the SEC. Nikola didn’t admit any wrongdoing.

The U.S. District Attorney’s Office for the Southern District of New York, which prosecuted the case, declined to comment on Milton’s pardon.

At the time of his conviction U.S. Attorney Damian Williams said, “Trevor Milton lied to investors again and again -- on social media, on television, on podcasts, and in print. But today’s sentence should be a warning to start-up founders and corporate executives everywhere -- `fake it till you make it’ is not an excuse for fraud, and if you mislead your investors, you will pay a stiff price.”

The White House said Trump also pardoned on Thursday cryptocurrency entrepreneurs Arthur Hayes, Benjamin Delo, and Samuel Reed. The three men founded and help run the cryptocurrency exchange BITMEX, which was ordered to pay a $100 million fine earlier this year after prosecutors said it “willfully flouted U.S. anti-money laundering laws to boost revenue.” Hayes, Delo and Reed pleaded guilty in 2022 to violating the Bank Secrecy Act and were sentenced to probation.

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By Matt Ott

Associated Press writers Darlene Superville and Alan Suderman contributed.