Electric vehicle maker Nikola has disclosed it received subpoenas from federal and state authorities amid allegations that it misled investors about its technology and manufacturing capabilities.
Nikola has been under scrutiny since short-seller Hindenburg Research released a report on Sept. 10 that described it as an “intricate fraud built on dozens of lies” by its founder, Trevor Milton.
In a regulatory filing, the company said it received a series of subpoenas between Sept. 19 and Sept. 30, including some from the U.S. Securities and Exchange Commission “as part of a fact-finding inquiry related to aspects of the company’s business as well as certain matters” described in the Hindenburg report.
Additionally, Nikola and Milton have received grand jury subpoenas from the U.S. Department of Justice and the company received a subpoena from the Manhattan District Attorney.
“The company has cooperated, and will continue to cooperate, with these and any other regulatory or governmental requests,” the filing said.
Hindenburg released its report — entitled “Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America” — two days after Nikola announced a strategic partnership with General Motors to produce electric and fuel-cell vehicles.
Under the terms of the deal, Nikola would give GM $2 billion in newly issued common stock, representing an 11% stake in its company. The short-seller report, however, caused the stock to tank, fueling speculation that GM would ask for a larger stake.
The agreement could be terminated by either company if it does not close by Dec. 3.
“The contemplated agreement … is not yet closed but discussions do continue,” Nikola CEO Mark Russell said Monday on an earnings call.
Nikola announced on Sept. 21 that Milton resigned as its chairman. In trading Tuesday, its shares fell 3.2% to $18.03.