The Bankwatch

Tracking the consumer evolution of financial services

Nikola founder steps down fuelling the Reports of Fraud

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The scale of fraud nowadays takes the requirement for Banking due diligence on prospective customers to sensational heights. There has been these gigantic frauds:

  • Wirecard
  • Luckin Coffee
  • Older ones: Enron, Cendant, and WorldCom

Over the last 10 days Nikola, a one time potential competitor to Tesla has been sidelined by reports from Hindenberg Research:

Last week, we issued a report that presented extensive evidence of a litany of material false statements made by Nikola’s Founder and Executive Chairman, Trevor Milton.

We included 53 questions at the end of our report that we believe shareholders deserve answers to. The company promised a full point-by-point rebuttal, but then only responded to 10 of our questions.

Of those 10 responses, the company debunked nothing. Instead it either confirmed or sidestepped virtually everything we wrote about, and in some cases raised new unanswered questions.

Nikola Failed to Address 43 of our 53 Questions. Of Those It Touched On, It Largely Confirmed Our Findings or Raised New Questions

Nikola Admitted That Its Deceptive “Nikola One in Motion” Video Was, In Fact, Video of The Semi-Truck Simply Rolling Down A Hill.

The Company Says It Never Claimed the Truck Was Powering Itself, Despite Deceptive Editing and Claims That it Had “1,000 HP” With “Sports Performance”

In our report, we explained how the company released a video called “Nikola One in Motion”, which made it seem that its Nikola One semi-truck was traveling under its own power at a high rate of speed. Angles in the video were edited to make it appear as though the semi was moving on a roadway that was flat, or even uphill.

A key part of this fight centred on whether an electric truck moved downhill under its own power or was freewheeling. By Nikola own admission it turns out the answer is freewheeling.

What ??

Relevance to Bankwatch:

Due diligence has moved beyond documentary analysis. Hands and feet on the ground are required much as occurred within the mortgage industry. (Think faked employment. Confirmation, or cash down payment holdings)

Words on a document can be faked.

I am seeing bankers behind the wheel of an 18 wheeler pressing the brake and accelerator.

Written by Colin Henderson

September 21, 2020 at 12:03

Posted in Uncategorized

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