Indicted Nikola Founder Trevor Milton Has Lost Over $7 Billion As Shares Have Cratered

Trevor Milton, founder of hydrogen-fueled truck developer Nikola and the target of new criminal and civil charges from U.S. prosecutors, has lost roughly $7.6 billion in the last 13 months, due to the plummeting value of Nikola shares amid accusations of Milton lying to investors (which Milton has denied).

Milton’s fortune has dropped from $8.7 billion at its height, in June 2020, to just $1.1 billion at the end of trading Thursday, according to Forbes estimates. That includes the 15% tumble in Nikola’s stock on Thursday as investors digested the federal government’s one-two punch: The U.S. Attorney’s Office for the Southern District of New York brought three criminal charges against Milton, including two counts of securities fraud and one count of wire fraud. The Securities and Exchange Commission also filed a civil suit against him for securities fraud. Milton pleaded not guilty to the criminal charges on Thursday.

Milton’s wealth peaked on June 9, 2020, when Nikola shares closed at a high of $79.73. The pre-revenue company (it expects to sell between 50 to 100 trucks in Q4 2021) briefly boasted a market capitalization of more than $30 billion, eclipsing that of Ford. The stock soon fell, but Milton’s $3.3 billion fortune as of late July 2020 was enough to land him on The Forbes 400 list of richest Americans, at No. 249.

That ranking would be short-lived. On September 10, 2020, short seller Hindenburg Research published an explosive report on Nikola, alleging Milton repeatedly lied about key aspects of Nikola’s business. The company’s stock fell 35% in less than two weeks. On September 21, Milton stepped down from his role of executive chairman. He denied Hindenburg’s allegations and said “the focus should be on the company” and not him; Nikola thanked Milton for his “visionary leadership and significant contributions to Nikola.”

Most of Milton’s current estimated $1.1 billion fortune consists of the roughly 19.5% stake he has in Nikola, worth about $930 million. Additionally, Forbes estimates that Milton netted nearly $200 million after taxes from selling Nikola shares. He purchased a luxury ranch in Utah for $32.5 million in November 2019. 

The collapse in value of Nikola stock has driven the decline in Milton’s fortune, but another factor is Milton’s agreement in August 2020 to distribute  six million stock options to his employees—worth about $72 million. These transfers from Milton’s personal stockpile of options began last December, SEC filings show. 

Milton’s net worth could sink lower still, depending on the outcome of the charges brought against him. The U.S. Attorney’s Office for the Southern District of New York said in its indictment that Milton should forfeit all property “derived from proceeds traceable to the commission of” alleged offenses. The SEC civil suit similarly demanded Milton disgorge all “ill-gotten gains” and pay a civil penalty. 

Milton is innocent until proven guilty, which means his fortune is safe for now. But if jurors rule against him, that could change, according to legal experts. 

“Any things that Mr. Milton has acquired as a result of the [alleged] fraud are fair game” if he is found guilty, says Jared Carter, a professor at Vermont Law School. “That could be significant terms of properties, real estate, as well as any other investments that he may hold”— including Nikola stock. 

Milton will also have to pony up for defense lawyers. “Presumably, he’s going to be hiring sophisticated lawyers and law firms, which are going to be charging in the thousands of dollars an hour range,” says Carter. 

“We’re talking about hundreds of thousands of dollars, and probably far in excess of that. Millions, probably.” 

A representative for Milton declined to comment.