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Greenwashing and Nikola




In another world this would be a very big story now. In this world, too much else seems to be going on and the Nikola trial has been thrown into obscurity. Even in the world of trial reporting -- Alex Jones was big, a document thief who lives in a golf club is big, Harvey Weinstein is big. The trial of Trevor Milton, the former CEO of Nikola, has been lost. 

There can't be more than three trials-of-the-century underway at any one time. 

But let's get into this. The title of the company is meant to honor Nikola Tesla and, if you are a cynic, you might suppose it was invented to suggest (without asserting) some sort of connection with the Elon Musk entity Tesla. There is no such connection, though. 

Nikola (like Tesla) manufactured electric cars and trucks. In mid 2020 Nikola was flying high. Its stock was worth $65. By July 2021, though, shares were down to around $12 and the CEO, Trevor Milton, was indicted for "lying about nearly all aspects of the business" to attract suckers ... um ... investors. 

Milton's trial wrapped up last week. The jury began and completed deliberations Friday. It found Milton guilty. 

Specifically, it brought in a guilty verdict on three of the four charges against him.  He was charged with two counts of wire fraud and two of securities fraud. He was acquitted of ONE of the securities fraud counts both of those on wire fraud.

My view? He is probably guilty, and his guilt is of a very general sort. There are a sufficient number of investors today who want to put their money into green ventures, "sustainable capitalism," that it is very tempting for an entrepreneur with a streak of fraudster in him to decide that he is going to sell whatever it is he needs to sell on the theory that it is exactly that. 

The product in question isn't really green. It was merely "washed" in green for the sake of the sale.


 



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  1. Paul D. Van PeltOctober 20, 2022 at 7:25 AM

    I stand on a previous assertion regarding excess, extremism and exaggeration, lobbied in a comment on another blog post. Your statement about three trials of the century is spot on. Someone is always trying to sell something---even when it turns out they have nothing to sell. My deepest thanks to Dr. Matthias in San Francisco for his kind response.

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