Milton was convicted of two counts of wire fraud and one count of securities fraud in October 2022 and could face up to 60 years in prison. However, New York prosecutors last week recommended an 11-year prison sentence. In June 2020, Milton became a billionaire overnight by taking Nikola public in a deal with a special purpose acquisition company.
Nikola was quickly touted as one of the most promising electric vehicle startups, with a market capitalization of more than $30 billion at its peak, until short-seller Hindenburg Research uncovered allegations of false and misleading statements.
Prosecutors on Tuesday compared Milton to disgraced Theranos founder Elizabeth Holmes, who was sentenced last year to more than 11 years in prison for defrauding investors in her blood-testing startup.
"Just as Holmes lied about the blood analyzer manufactured by Theranos, Milton lied about the operability of the Nikola One semi-truck," prosecutors wrote to U.S. District Judge Edgardo Ramos, who was deciding Milton's sentencing.
Milton tried to point out that he was very different from Holmes because the latter's company was not public. According to court documents, Milton argued that "Nikola remains a bona fide business and Theranos does not."
Milton is Nikola's largest shareholder. He resigned as Nikola's executive chairman in September 2020. Prior to this, Hindenburg Research conducted an internal investigation of Nikola and Milton, describing the company as a house of cards built by Milton.