[The Exiled]

Founder of Tesla competitor Nikola steps down amid fraud scandal

Nikola is now facing an investigation by both the US Securities and Exchange Commission and the Department of Justice, according to Bloomberg. Following the announcement of Milton’s resignation, the company’s shares fell by 22 percent in US pre-market trading. The electric carmaker, which has yet to make any revenue, called the Hindenburg report “false and defamatory.” Despite the denial, the company did not end up disputing that a semi truck it showed off in a 2018 video was not able to propel itself — it essentially just rolled down a hill. Trevor Milton’s decision to step down as executive chairman of Nikola Corp. is costing him.

Shares of the electric-vehicle startup that Milton founded in 2014 fell 20% to $27.42 as of 11:32 a.m. in New York. They plunged as much as 30%, valuing his holding at $2.8 billion. That’s about $1 billion less compared with Friday’s close, according to the Bloomberg Billionaires Index. Milton owns about a third of the Phoenix-based company, which makes up the bulk of his wealth and has come under increasing scrutiny since it began trading publicly in June. The resignation is the latest to hit Nikola after an extraordinary rise for Milton, a 39-year-old college dropout whose fortune soared when he took Nikola public through a reverse merger. He agreed to relinquish stock units that were worth about $166 million as of the end of last week and also gave up his board seat at the company, which has yet to generate any meaningful revenue.