Federal prosecutors accused Mr. Milton of misleading investors about the battery- and hydrogen-powered car technology Nikola hoped to produce.

In a warning shot to a thriving corner of Wall Street, federal authorities on Thursday filed criminal and civil securities fraud charges against the Nikola founder, a start-up automaker that went public last year by merging with an investment fund.

The indictment from the U.S. Attorney’s Office in Manhattan accuses founder Trevor Milton of misleading investors — particularly individual investors — about the battery- and hydrogen-powered car technology he hoped to produce. In a separate civil case filed Thursday, the Securities and Exchange Commission also accused Mr. Milton of securities fraud.

The two court cases are the biggest lightning bolts that prosecutors and securities regulators have directed at the heated market for investment vehicles known as specialized acquisition companies, which regulators and some investors say are rife with potential problems. Several more such cases could be filed in the coming months; regulators are investigating several other companies and executives in similar circumstances.

Investment vehicles called SPACs have raised nearly $200 billion in initial public offerings for the express purpose of finding and buying operating businesses. If SPACs don’t buy a company within two years, their sponsors, often professional investors or Wall Street bankers, must return the funds raised, a provision that critics say encourages them to buy shaky or unproven companies.

The SPAC boom coincided with and was spurred by retail investors who share trading tips and strategies on social media, often deciding en masse to buy stocks of companies they believe are undervalued or doomed to greatness. These individual traders, often backed by professional investors or corporate executives, have helped drive up the stock prices of various companies, including GameStop, AMC and Tesla.

Prosecutors and the S.E.C. said that for nearly a year, Mr. Milton used social media, television and podcasts to spread “false and misleading statements about Nikola’s products and technology.”

One of those misleading statements, according to an indictment filed by prosecutors, concerned a Nikola One prototype truck for long-distance travel. The prototype did not work, contrary to Mr. Milton’s enthusiastic claims about it.

Federal prosecutors and securities regulators began investigating Nikola last fall, around the time the investment firm published a report questioning the company’s products and some of Mr. Milton’s statements. That firm, Hindenburg Research, said the company had released a promotional video claiming to have a working prototype, but did not disclose that the truck was only moving forward because it was rolling downhill in neutral gear. A few weeks later, Mr. Milton resigned.

S.E.C. also noted in its complaint that a June 2020 Bloomberg News article stated that Mr. Milton had “exaggerated” the capabilities of his truck.

Yet Nikola went public in June 2020 through a $700 million merger with a SPAC called VectorIQ, which was founded by Steve Girsky, a former General Motors executive and board member who also worked at Morgan Stanley. Mr. Girsky put Mr. Milton and Nicola in touch with G.M. CEO Mary T. Barra, and the two companies agreed to work together on heavy trucks and pickup trucks; that deal was cut significantly in November.

Some young, unchecked companies have opted to merge with SPACs because it usually happens faster, requires less disclosure, and attracts less investor and regulatory attention than a conventional initial public offering. Nikola, for example, managed to go public just five years after Mr. Milton founded it.

“In carrying out his fraudulent scheme, Milton took advantage of features of SPAC’s structure,” Audrey Strauss, the U.S. attorney in Manhattan, said Thursday.

Federal prosecutors say retail investors, but not the company’s early investors, including Mr. Milton, were hurt by the sharp decline in the stock that began last summer. Nikola’s stock was trading at less than $13 Thursday afternoon, down about 10 percent for the day, after falling from more than $65 in the middle of last year, when the company was valued higher than Ford Motor.

The S.E.C. complaint says Mr. Milton owned about 25 percent of Nikola after the SPAC deal and “ended up receiving tens of millions of dollars in personal gain as a result of his misconduct.” Securities regulators noted that Mr. Milton “began a relentless PR blitz targeting a class of investors he called ‘Robinhood investors.'” – a reference to the popular retail brokerage, which had just raised $2.1 billion in its own initial public offering.

Mr. Milton’s legal team said in a statement that the government was trying to “criminalize the legitimate conduct of business.” The team added: “Mr. Milton was unfairly prosecuted after a flawed and incomplete investigation in which the government ignored important evidence and failed to interview important witnesses.”

Mr. Milton was taken into custody in Manhattan Thursday morning and was released on $100 million bail, signed by two other people and secured by two properties worth $40 million.

Nikola said in a statement that Mr. Milton has not been involved with the company since he resigned in September 2020. “Today’s government action is directed against Mr. Milton individually, not against the company,” the company said. “Nicola cooperated with the government throughout the investigation.”

Authorities have not charged others, including other executives, or the company itself with wrongdoing. The S.E.C. complaint appears to justify its focus solely on Mr. Milton, noting that even after he became executive chairman of Nikola after the merger with VectorIQ, he firmly controlled the company and remained its chief spokesman and gave orders to others. The complaint calls him a hands-on executive who “immersed himself in the details of Nikola’s technology and product development process.”

Mr. Milton, who was a high school and college dropout, founded Nikola with the goal of becoming a Tesla in the trucking industry. Like Elon Musk, head of Tesla, Mr. Milton has built a reputation as a charismatic showman with a grand vision of revolutionizing the industry. “We’re going to completely control trucking in America,” he told Automotive World last year.

Mr. Milton even named his company after the inventor whose last name Mr. Musk’s business uses – Nikola Tesla.

Tempted by the prospect of finding the next Tesla, investors large and small have poured money into startups like Nikola in recent years. They believed that the world would quickly shift from fossil-fueled cars and trucks to electric and hydrogen-powered vehicles, and that it would be startups, not established automakers like G.M. and Daimler, that would lead the way. But unlike Tesla, which has produced and sold hundreds of thousands of electric cars in a few years, many of the new entrants have struggled to produce even a few thousand.

Since this year, the S.E.C. has been warning investors about the dangers of SPACs and the companies they acquire, specifically not to lull people into overly optimistic statements. Several companies that have completed mergers have reported investigations by the EPA, federal prosecutors, or both.

According to the Stanford Law School Securities Clearinghouse, since 2019, shareholders have sued at least 30 companies that went public in a merger with SPAC.

Eric Gordon, a professor of business and law at the University of Michigan, believes authorities are “making it clear that they consider SPAC a hotbed of more serious things than just negligent disclosure.” He added: “They see it as a breeding ground for fraud and misrepresentation.”

Just two weeks ago, S.E.C. reached a settlement agreement with several parties involved in the planned merger of Momentus, a company that said it developed unique propulsion technology, and Stable Road Acquisition, SPAC. Regulators said investors were misled into believing that the propulsion system had been successfully tested in space, when in fact it had failed.

Federal prosecutors and securities regulators are also investigating Lordstown Motors, a company that hopes to produce electric pickup trucks and merged with SPAC last year.

Lordstown, based in Ohio, said it was able to raise much-needed cash this week, but it has yet to begin commercial production. Federal authorities are investigating whether the company and its founder, Steve Burns, who stepped down as CEO in June, exaggerated claims of customer interest in its trucks, which are intended for use by businesses such as contractors and utilities.

Federal prosecutors are also investigating Lordstown’s merger with DiamondPeak, an SPAC created by David Hamamoto, a former Goldman Sachs partner and Wall Street real estate investor.

But supporters of SPACs said the allegations against Mr. Milton and other investigations should not be used to tarnish the reputation of these investment vehicles, which some people on Wall Street say are innovative. Douglas Ellenoff, a New York lawyer whose firm specializes in representing the founders of SPACs, said some regulators “make statements that stigmatize the industry as a whole.”

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