The US Securities and Exchange Commission (SEC) Tuesday announced that zero-emission vehicles startup Nikola Corporation has agreed to pay $125 million to settle charges that it violated US securities laws and defrauded investors by misleading them about its products, technical advancements, and commercial prospects.

The settlement emerges from the SEC’s order issued earlier this year, holding the company liable for “allegedly misleading statements and for other alleged deceptions” by its founder and CEO, Trevor R. Milton. Milton is accused of “repeatedly disseminating false and misleading information” to investors about the company’s products and technological accomplishments, even before the company had produced a single commercial product. The SEC alleges that the public relations campaign was aimed at inflating and maintaining the company’s stock prices.

The SEC had previously announced charges against Milton and arrested him in July. Milton’s defense has argued that the prosecution is focusing on “tweets, social media posts, podcasts, and television or print interviews” made before the company went public and attempting to criminalize promotional speech about the company’s product. Milton is presently out on a $100 million bail bond.

As per the settlement, Nikola is neither admitting nor denying the SEC’s findings but has agreed to cease and desist from future violations as well as certain voluntary undertakings. It will pay a $125 million penalty which will be returned to victim investors through a Fair Fund. The amount will be paid in five installments over a two-year period, with the first installment due at the end of 2021. The company also agreed to cooperate with the SEC’s ongoing litigation and investigation.