Electric- and hydrogen-powered truck startup Nikola has agreed to a $125 million settlement over charges that it defrauded investors after misleading them about its products, technical advances and financial prospects.

Nikola violated the antifraud and disclosure control provisions of the federal securities laws, the Securities and Exchange Commission said Tuesday.

In July the founder and one-time chair of Nikola, Trevor Milton, was freed on $100 million bail after pleading not guilty to charges alleging he lied about the company.

The U.S. Attorney’s Office in Manhattan, New York, charged Milton, 39, with two counts of securities fraud and wire fraud. He resigned as chairman in September.

The SEC said in its order that Milton embarked on a public-relations campaign aimed at inflating and maintaining Nikola’s stock price before the company had produced a vehicle.

The SEC also found that Milton misled investors about Nikola’s technological advancements, in-house production capabilities, hydrogen production, truck reservations and orders, and financial outlook. In addition, it found that Nikola misled investors by misrepresenting or omitting information about the refueling time of its prototype vehicles, as well as the economic risks and benefits associated with a potential partnership with General Motors.

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Source: EV startup Nikola settles with U.S. for $125 million | The Seattle Times

Also see: Nikola Admits Prototype Was Rolling Downhill In Promo Video

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According to court documents, Ishii switched the transfer address for a Sony Life transaction to use a Silvergate Bank account under his control..

Ishii later converted the stolen funds into more than 3879 bitcoins via A Coinbase set up to automatically transfer all added funds to an offline cryptocurrency cold wallet with a Bitcoin address of bc1q7rhc02dvhmlfu8smywr9mayhdph85jlpf6paqu.

After converting the money to cryptocurrency, Ishii also tried persuading his supervisor and several Sony Life executives not to help investigators by emailing them a ransom note typed in English and Japanese.

“If you accept the settlement, we will return the funds back. If you are going to file criminal charges, it will be impossible to recover the funds,” the note read.

“We might go down behind all of this, but one thing is for sure, you are going to be right there next to us. We strongly recommend to stop communicate (sic) with any third parties including law enforcement.”

Cryptocurrency seized following FBI investigation

However, on December 1, following an investigation in collaboration with Japanese law enforcement authorities, the FBI seized the 3879.16242937 BTC in Ishii’s wallet after obtaining the private key, which made it possible to transfer all the bitcoins to the FBI’s bitcoin wallet.

“Sony and Citibank immediately contacted and cooperated with law enforcement as soon as the theft was detected, and the FBI worked in partnership with both to locate the funds,” explained FBI Special Agent in Charge Suzanne Turner.

“Second, the FBI’s footprint internationally through our Legal Attaché offices and the pre-existing relationships we have established in foreign countries – in this instance with Japan – enabled law enforcement to coordinate and identify the subject.”

Tokyo’s Metropolitan Police Department arrested the 32-year-old Ishii the same day and criminally charged him on suspicion of obtaining $154 million dollars following fraudulent money transfers from mid-May.

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Source: US returns $154 Million in bitcoins stolen by Sony employee