Autos

Nikola discloses grand jury subpoenas from DOJ

Key Points
  • Nikola and its founder, Trevor Milton, received grand jury subpoenas from the Department of Justice in September in connection with allegations of fraud raised by short-seller Hindenburg.
  • The company also received a grand jury subpoena from the New York County District Attorney's Office that month.
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Inside Nikola — the one-time Wall Street darling mired in controversy

Nikola and its founder, Trevor Milton, received grand jury subpoenas from the Department of Justice in September in connection with allegations of fraud raised by short-seller Hindenburg.

The embattled electric-truck maker disclosed the subpoenas in a regulatory filing late on Monday.

The filing also said the company received a grand jury subpoena from the New York County District Attorney's Office in September. Grand juries are typically impaneled in criminal investigations.

The Securities and Exchange Commission also issued subpoenas to Nikola, its board and eight of its officers and employees in September, the company disclosed in the filing, which was prompted by the short-seller's scathing report earlier that month.

Monday's filing came hours after Nikola CEO Mark Russell told investors that the company was "fully cooperating" with requests by federal investigators regarding the short-seller report.

"Nikola proactively contacted and briefed the SEC during their quarter regarding our concerns pertaining to a report published by a short-seller," Russell said during its third-quarter earnings call. "Our council has been in close contact with the SEC and the Department of Justice and we are fully cooperating with both in their request for information and documents."

The federal probes were first reported ahead of Milton's resignation as chairman in September.

Hindenburg accused Milton of making false statements about Nikola's technology in order to grow the company and partner with auto companies. The report, titled "Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America," was released two days after the company announced a deal with General Motors that sent both companies' shares soaring in September. It characterized Nikola as an "intricate fraud built on dozens of lies" by Milton.

Nikola has denied and disputed many of the accusations, however the company confirmed one of Hindenburg's largest claims — that it staged a video showing a truck that appeared to be functional but wasn't.

Two women also have filed sexual assault claims with Utah authorities against Milton. Both allegations were more than 15 years old but involve a cousin and an office assistant when both were 15 years old. Milton's cousin Aubrey Ferrin Smith said he assaulted her in 1999 when he was 17 while the other woman says her alleged assault took place in 2004 when he was 22. CNBC doesn't identify the victims of sexual assault unless the victim chooses to publicly release their name.

Through a spokesman, Milton "strongly denied" what he said were false allegations but declined to address specific details of the women's complaints.

Reuters contributed to this report.