Trevor Milton, the founder of electric-truck startup Nikola Corp., was convicted of securities fraud and wire fraud in 2022. He was sentenced to four years in federal prison. He never served a day.
On the evening of May 19, 2025, President Donald Trump signed a full pardon for Milton, wiping clean a conviction that prosecutors had built over years and that a jury had affirmed after weeks of testimony. The pardon, first reported by the Wall Street Journal, came while Milton was free on bail pending appeal — and it arrived with no public explanation from the White House beyond a brief statement citing Milton’s contributions to American innovation and energy independence.
The move stunned federal prosecutors, corporate governance advocates, and investors who lost billions when Nikola’s stock collapsed after a short-seller’s report revealed that a promotional video of the company’s hydrogen-powered truck had been staged — the vehicle was rolling downhill, not driving under its own power. It also sent an unmistakable signal to Silicon Valley, Wall Street, and every startup founder with a pitch deck full of aspirational claims: the boundaries of acceptable corporate promotion just got blurrier.
From Utah Ranch to Federal Courtroom
Milton’s rise was, by any measure, spectacular. A college dropout from Utah, he founded Nikola in 2015 with a vision of building hydrogen fuel-cell trucks that would displace diesel in long-haul freight. The company went public in June 2020 through a merger with a special-purpose acquisition company, or SPAC, and within days its market capitalization briefly exceeded that of Ford Motor Co. — despite Nikola having produced zero revenue and zero trucks.
Milton was the engine of that valuation. He appeared on podcasts, tweeted prolifically, and gave media interviews in which he made sweeping claims about Nikola’s technology, partnerships, and order book. He told investors the company had a functioning semi-truck prototype. He claimed binding orders worth billions. He said Nikola was producing hydrogen at a fraction of market cost.
None of it was true, according to federal prosecutors.
The unraveling began in September 2020, when Hindenburg Research published a report titled “Nikola: How to Parlay an Ocean of Lies into a Partnership with the Largest Auto OEM in America.” The report alleged that Milton had made dozens of false and misleading statements to inflate Nikola’s stock price, including the staged truck video. Nikola’s shares cratered. Milton resigned as executive chairman within two weeks.
In July 2021, a federal grand jury in Manhattan indicted Milton on two counts of securities fraud and one count of wire fraud. Prosecutors argued he had deceived investors about nearly every aspect of Nikola’s business — its technology, its manufacturing capabilities, its partnerships, and its financial prospects. At trial in October 2022, the jury convicted him on all three counts. U.S. District Judge Edgardo Ramos sentenced him to four years in prison and ordered $165 million in restitution and forfeiture.
Milton never reported to prison. His legal team secured bail pending appeal, and the case wound through the Second Circuit Court of Appeals. Then came the pardon.
The timing was not accidental. Milton had cultivated relationships with Republican donors and conservative political figures throughout his legal ordeal. According to the Wall Street Journal, Milton had been lobbying for a pardon through intermediaries connected to Trump’s inner circle. He donated to political action committees aligned with Trump allies and positioned himself as a victim of prosecutorial overreach — a narrative that resonated in a political environment where Trump himself has railed against the Department of Justice.
Milton posted on social media following the pardon, writing that he was “grateful to President Trump for seeing through the injustice” and that he looked forward to “continuing to build the future of clean energy in America.” The post was widely shared on X, where reactions split sharply along political lines.
The Investor Fallout and the Message to Markets
The financial wreckage Milton left behind is staggering. Nikola’s stock, which peaked above $65 per share in June 2020, trades today below $2. The company filed for Chapter 11 bankruptcy protection in June 2024, unable to sustain operations or attract sufficient capital. Retail investors — many of whom bought in during the 2020 SPAC mania — lost their savings. Institutional investors wrote off hundreds of millions.
And now the man convicted of defrauding them walks free.
Legal experts say the pardon doesn’t erase the civil liabilities Milton still faces. The Securities and Exchange Commission filed a separate civil complaint against Milton in 2021, which resulted in a $125 million settlement — though Milton neither admitted nor denied wrongdoing as part of that deal. Shareholder class-action lawsuits remain pending. But the criminal conviction, the most potent form of accountability the justice system can impose for corporate fraud, has been nullified.
“A pardon in a case like this tells every promoter in the country that if you have the right political connections, the consequences of lying to investors are negotiable,” said John Coffee, a professor of corporate law at Columbia Law School, in an interview with Reuters. That’s a chilling message for a market that depends on trust.
The SEC declined to comment on the pardon. The U.S. Attorney’s Office for the Southern District of New York, which prosecuted the case, issued a terse statement saying it “respects the constitutional authority of the President” while standing by the jury’s verdict.
Some legal analysts have drawn comparisons to Trump’s earlier pardon of Steve Bannon, who was charged with defrauding donors to a private border-wall fundraising campaign. That pardon came in January 2021, during Trump’s first term. But the Milton case is different in a critical respect: Bannon was pardoned before trial. Milton was pardoned after a full trial, a conviction by a jury of his peers, and a sentencing by a federal judge. The system worked exactly as designed — and then it was overridden.
This distinction matters enormously. Presidential pardons are an absolute constitutional power, unreviewable by courts. But they carry political and institutional costs. When used to undo jury verdicts in fraud cases, they undermine the deterrent effect that criminal prosecution is supposed to provide. White-collar defense attorneys are already telling clients that the Milton pardon changes the calculus of cooperation and plea negotiations. Why plead guilty if there’s a chance, however small, that a future president might wipe the slate clean?
The pardon also arrives at a moment when the Trump administration has been systematically reducing the SEC’s enforcement capacity. Staff cuts, budget reductions, and the departure of senior enforcement officials have left the agency with fewer resources to police corporate fraud. If criminal prosecution is the backstop when civil enforcement fails, and pardons can neutralize criminal convictions, the question becomes: who’s watching?
Nobody, perhaps. Or at least not with the same authority.
Milton’s case also raises uncomfortable questions about the SPAC boom that made his fraud possible in the first place. Between 2020 and 2021, hundreds of companies went public through SPAC mergers, often with projections and claims that would have drawn intense scrutiny in a traditional IPO. The SEC under then-Chair Gary Gensler proposed new rules to hold SPAC sponsors to the same liability standards as conventional underwriters. Those rules were finalized in early 2024 but have since been paused under the current SEC leadership appointed by Trump.
So the regulatory framework that might have prevented the next Nikola is being dismantled at the same time the criminal justice system’s ability to punish the last one is being undercut.
For Nikola’s creditors and shareholders, the pardon is salt in an open wound. The company’s bankruptcy proceedings are ongoing, with unsecured creditors likely to recover pennies on the dollar. Milton, meanwhile, retains significant personal wealth. Court filings during his criminal case revealed that he owned a 2,500-acre ranch in Utah, multiple luxury vehicles, and other assets. The $165 million restitution order attached to his sentence is now legally void.
What Comes Next
Milton has signaled he intends to return to the energy sector. In posts on X following the pardon, he referenced new ventures in hydrogen infrastructure and expressed confidence that “the best is yet to come.” Whether investors will trust him again is an open question — but history suggests that in American business, a second act is always available to those with enough audacity and capital.
The broader implications are harder to predict but easier to fear. The United States has long positioned itself as a jurisdiction where the rule of law protects investors and where corporate fraud carries real consequences. That reputation is a competitive advantage. Foreign capital flows to American markets in part because investors trust that the system will hold bad actors accountable.
Every pardon that contradicts that premise erodes it a little more.
Trump’s allies argue the pardon was justified because Milton was targeted by an overzealous prosecution and that his claims about Nikola, while optimistic, were no different from the forward-looking statements routinely made by startup founders. This argument ignores the jury’s finding that Milton’s statements weren’t merely optimistic — they were fabricated. The truck didn’t work. The orders didn’t exist. The hydrogen production costs were fiction.
But in the current political environment, where populist distrust of institutions runs deep and where the line between entrepreneurial optimism and fraud has always been culturally contested, Milton’s pardon may not carry the political cost it would have a decade ago. The public’s attention is fragmented. The outrage cycle is short. And Milton, unlike the investors he defrauded, has time and resources on his side.
The pardon is done. It cannot be reversed. What remains is the precedent it sets — not in law, since pardons create no binding legal precedent, but in practice. In expectation. In the quiet calculation that every corporate executive and startup founder will now make when deciding how far to stretch the truth.
That calculation just got a lot easier.
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