Nikola stock soared 18% after the electric truck manufacturer delivered its first car. The stock soared a day after the firm revealed on Twitter that its very first customer delivery had been completed, indicating that more will follow.

Nikola announced earlier this week that it has consented to pay Securities and Exchange Commission about $125 million to settle claims that it misled investors about its products, business prospects, and technical capacity. According to the SEC, Nikola is accountable for the founder of the company and former CEO, Trevor Milton, making false representations. In July, he pleaded not guilty to allegations of fraud brought by the Department of Justice.

Officials from the Securities and Exchange Commission said they believed the penalty would act as a deterrent to all companies considering entering the public markets through a merger with a SPAC (special purpose acquisition company). Officials specifically stated that representations made by companies seeking to access public financial markets must be accurate.

Nikola is to blame, according to Wall Street’s top regulator, for false statements made by the company’s founder and former CEO, Trevor Milton, who pled not guilty to the fraud charges levied by the Department of Justice in July. The measure, which was revealed Tuesday morning, was the SEC’s most recent attempt to tighten regulations on SPACs, often known as “blank-check firms.” In the spring, the regulator provided new accounting rules, effectively ending a spike in SPACs. As the year progressed, they began to rise once more.

Ex-President Donald Trump, for example, is seeking a SPAC merger that would create a social media plus streaming corporation, according to him. The Trump SPAC deal is being investigated by the SEC. Nikola had informed investors that a fine was possible when it went public in June of 2020 by combining it with a SPAC. The SEC investigation and punishment are unrelated to the Department of Justice’s criminal investigation. In July, a federal grand jury charged Milton with lying about “virtually all facets of the business” in order to boost the electric vehicle start-stock up’s sales.

Through SPAC agreements, the corporation paved the way for pre-revenue electric car start-ups to go public. Investor interest in such firms soared after Tesla surpassed Toyota as the world’s most valuable automaker by market capitalization in 2020. In a statement, Nikola stated that it neither admits nor disputes the conclusions of the SEC that led to the settlement.

“We are glad to put this chapter to an end,” the business added, “since the company has finally concluded all government inquiries.” Nikola promised to continue working with “ongoing litigation and inquiry,” according to the SEC. Nikola was among at least four electric car start-ups being investigated by federal authorities for possibly deceiving investors. Lordstown Motors, Lucid, and Canoo are the others.

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