World News

Hunter Biden business associate's text messages indicate meeting with Joe Biden

Hunter Biden’s former business partner releases emails about 2017 Chinese energy company deal

Tony Bobulinski tells Fox News the Biden family ‘aggressively leveraged’ its name in foreign business dealings; Mike Emanuel reports from Washington.

EXCLUSIVE: Text messages obtained by Fox News show the CEO of a Jim and Hunter Biden joint venture with a Chinese energy firm discussing a meeting with Joe Biden in May 2017, despite past claims from the former vice president that he did not talk about his son's business dealings.

Fox News obtained text messages from Tony Bobulinski, a retired lieutenant in the U.S. Navy, and the former CEO of SinoHawk Holdings, which he said was the partnership between the CEFC/ Chairman Ye and the two Biden family members.

The messages seem to indicate that a meeting took place, though it's unclear what the substance of the meeting may have been. They are unrelated to the laptop or hard drive purportedly belonging to Hunter Biden, the former vice president's son.

“Mrng plse let me knw if we will do early dinner w your Uncle & dad and where, also for document translation do you want it simple Chinese or traditional?” Bobulinski texted Hunter Biden on May 2, 2017.

“Not sure on dinner yet and whatever is the most common for a Chinese legal DOC,” Hunter Biden replied.

“Chinese legal docs can be both, i’ll make it traditional,” Bobulinski said.


Hunter replied: “Dad not in now until 11- let’s me I and Jim meet at 10 at Beverly Hilton where he’s staying.”

Later, Bobulinski sent a text to Jim Biden, Joe Biden's brother, on the same day, May 2, 2017, saying: “Great to meet u and spend some time together, please thank Joe for his time, was great to talk thx Tony b.”

The text message chain was obtained after the Senate Homeland Security and Governmental Affairs Committee and the Senate Finance Committee requested documents related to Bobulinski’s business affairs with the Biden family. He has provided the committees with the documents. Fox News has also, separately, obtained those documents.

The meeting on May 2, 2017, would have taken place just 11 days before the May 13, 2017, email obtained by Fox News last week, which included a discussion of “remuneration packages” for six people in a business deal with a Chinese energy firm. The email appeared to identify Biden as “Chair / Vice Chair depending on agreement with CEFC,” in an apparent reference to now-bankrupt CEFC China Energy Co.


The email includes a note that “Hunter has some office expectations he will elaborate.” A proposed equity split references “20” for “H” and “10 held by H for the big guy?” with no further details.

The Biden campaign has said it has released the former vice president’s tax documents and returns, which do not reflect any involvement with Chinese investments. The campaign declined to comment to Fox News.

Bobulinski, in a statement to Fox News, said “Hunter Biden called his dad ‘the Big Guy’ or ‘my Chairman,’ and frequently referenced asking him for his sign-off or advice on various potential deals that we were discussing.”

"I've seen Vice President Biden saying he never talked to Hunter about his business," Bobulinski said. "I've seen firsthand that that’s not true, because it wasn't just Hunter's business, they said they were putting the Biden family name and its legacy on the line."


He added: “I realized the Chinese were not really focused on a healthy financial ROI.  They were looking at this as a political or influence investment.”

“Once I realized that Hunter wanted to use the company as his personal piggy bank by just taking money out of it as soon as it came from the Chinese, I took steps to prevent that from happening,” Bobulinski said, adding that he asks “the Biden family to address the American people and outline the facts so I can go back to being irrelevant — and so I am not put in a position to have to answer those questions for them.”

Bobulinski said he doesn’t “have a political ax to grind.”


“I just saw behind the Biden curtain and I grew concerned with what I saw,” he said. “The Biden family aggressively leveraged the Biden family name to make millions of dollars from foreign entities even though some were from communist-controlled China.”

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The coronavirus pandemic has hit women in business particularly hard

It’s hard enough being a female business owner or employee in a world still very much dominated by men. Unfortunately, the coronavirus pandemic has made things even harder.

That’s according to a new report released by the Female Founders Alliance, a non-profit network of companies and individuals that provides resources and programming for women and non-binary founders, investors and entrepreneurs. Their September 2020 study, which included an undisclosed number of professional women and non-binary individuals, found that, before the pandemic, 87% of respondents said they were “highly likely to start a company” whereas, six months later, 51% said they had “delayed or scrapped their plans”.

My election advice to small businesses? Let your people vote | Gene Marks

The study dovetails with other reports that have recently come to light about the impact that the pandemic has been having on female workers and employees. Spoiler alert: it’s been very, very tough.

For example, Sheryl Sandberg’s LeanIn organization, has been published numerous reports throughout the summer documenting how many women are “maxing out and burning out”, and facing a financial crisis due to the pandemic’s impact on their careers and home lives. “Covid-19 threatens to roll back the progress we have painstakingly made over the last five to 10 years for women in the workplace,” Sandberg recently told NPR. “We are pulling the alarm bell here.”

The Department of Labor reports that 865,000 women across many industries have left the workforce between August and September compared with 216,000 men. A recent joint study from McKinsey and LeanIn found that one in four women have or are considering downshifting their career or leaving the workplace early, all because of the pandemic. To make matters worse, yet another report found that men, by a margin of more than four to one, are being promoted even while working at home compared with their female counterparts.

“Women are already underrepresented in the workforce and this will wind back hard-earned progress.” Rachel Thomas, a co-founder and CEO of LeanIn told CNN.

Does any of this come as a surprise? Not to me. Despite all the progress female entrepreneurs and employees have made over the years – and all you need to do is watch a few episodes of Mad Men to understand just how much – there’s still a long way to go before women are truly treated equally in the workplace to their male counterparts.

The reasons are obvious. With so many of us being stuck at home with kids learning virtually, who’s doing the heavy lifting? Yeah, it’s the moms. I will say that, anecdotally, many of the work-from-home moms I know are choosing to focus more on their kids, schools and other household duties than their male partners. Some I know are enjoying the opportunity. But I’m not so sure they’re being given much of a choice.

I have confidence that, once the pandemic is behind us, female entrepreneurs and employees will pick things up where they left them. But there’s been a significant setback in their progress, and as business owners, we must be very aware of the challenges that our female employees, partners and owners of the firms we sell to and buy from are dealing with right now. That means offering more flexibility, time off, patience and accommodation. Most people won’t ask for that kind of help. But that doesn’t mean they don’t need it.

“Companies need to be flexible,” Sandberg said in the NPR report. “Companies need to recognize the burdens women, particularly women of color, are facing at home. And companies need to adjust so that we don’t lose the talent, the female talent, the women, the women of color that are so critical to doing well going forward.”

One bright spot for females: according to another report from McKinsey geared to wealth managers, due to demographic changes that are quietly happening right now, American women by 2030 are expected to control “much of the $30 trillion” in financial assets that the ageing baby boomer population possesses. It is expected to be a substantial increase from the $10.9tn in household assets women currently control and would be “a potential wealth transfer of such magnitude that it approaches the annual GDP of the United States”.

This is a wake-up call for male leaders, bosses and business owners: do your best to help your female workers, partners, customers and suppliers during these difficult times. It’s not only the right thing to do. It will in the future turn out to be the profitable thing to do as well.

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Indian businesses gear up in hopes of festive cheer after months of lockdown

  • Indian businesses are stocking up more ahead of this year's big festival season than at any time in the last five years, expecting people whose earnings were relatively unaffected by the pandemic to spend the money they saved during months of lockdowns.
  • India's biggest shopping season is at the time of the festivals of Durga Puja and Diwali, which fall 20 days apart in October-November each year.
  • Businesses and shopkeepers expect more purchases than usual this year, beginning with Durga Puja on Thursday, because the months of lockdowns have resulted in pent-up demand.

Indian businesses are stocking up more ahead of this year's big festival season than at any time in the last five years, expecting people whose earnings were relatively unaffected by the pandemic to spend the money they saved during months of lockdowns.

India's biggest shopping season is at the time of the festivals of Durga Puja and Diwali, which fall 20 days apart in October-November each year. Traditionally, this is a time when houses are redecorated, big-ticket items purchased, feasts held and gifts exchanged.

Businesses and shopkeepers expect more purchases than usual this year, beginning with Durga Puja on Thursday, because the months of lockdowns have resulted in pent-up demand.

Recent data shows that demand for diesel, power and cars has already picked up, and any resurgence of retail buying of everything from phones to furniture would bode well for India's economy that shrank 23.9% in the quarter ended June — its steepest decline.

Brokerage firm Nomura said its India business-resumption index for the week that ended on Oct. 18 hit its highest level since the country first imposed a lockdown in late March to contain the coronavirus.

Big retailers such as Croma and Vijay Sales, both dealing mainly in electronics and home appliances, told Reuters sales in recent days indicated that this holiday season could be better than last year and that they were actually worried about tightening inventory in certain categories like entry-level laptops and high-end televisions.

The Confederation of All India Traders (CAIT) said its 70 million small businesses on average were planning for a buffer stock of around 14% this season compared with last year's 10%, to ensure they don't run out of goods should demand surge.

"In the last two months, despite facing a financial crunch, we have been procuring goods in anticipation that in the festive season we will have considerable footfalls," said Praveen Khandelwal, the group's secretary-general, seated in his home-fittings shop in Delhi's Karol Bagh area.

"Our expectation is that this will be the best Diwali for us in at least five years. Naturally, our stock levels will be as high too."

Customer arrivals this month have already been the highest in about seven months, hovering around 10 per shop on average — still only about a third of the normal level but expected to rise, Khandelwal said.

'Cautiously optimistic'

But not everyone is as enthusiastic. Shops and factories in the city of Jaipur, typically bustling with local and foreign tourists, did little business on a warm afternoon this week.

Traders there said they had laid off staff as the city's key income source of tourism was still feeble and it did not have as many salaried people as places like Delhi.

"Until a vaccine is out, I think we will keep operating at 30%-35% of pre-Covid levels," said Suresh Tak, owner of four clothes shops and factories printing designs on fabrics.

Even Google's mobility data from last week for West Bengal, India's fourth-most populous state where Durga Puja is the main festival, showed that people were mainly visiting supermarkets and pharmacies, not retail and recreation facilities.

Thousands of miles away in the rural district of Satara in India's west, Nilesh Kadam says he is trying to save as much as he can, having returned to work only recently.

"From June to August the company had given me a break as there wasn't much work at the factory," said the 35-year old, whose company makes steel products. "This year I am not planning to make any big-ticket purchase."

Still, CAIT estimates Indians have amassed about 1.5 trillion rupees ($20 billion) in savings since April, a chunk of which could now be directed to holiday shopping.

Online retailers Amazon and Walmart Inc's local unit Flipkart have also kicked off their annual sales events with heavy discounts. Flipkart said on Wednesday sales have tripled for more than 35% of its sellers this year and that there were "green shoots of recovery for everyone across the value chain".

Hindustan Unilever Ltd, the Indian arm of Unilever, on Tuesday reported higher sales and profits for the
September quarter and said its rural markets had been more "resilient" than the big cities. "We believe the worst is behind us and we are cautiously optimistic on demand recovery," Chairman Sanjiv Mehta said on an earnings call.

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Sky to open network of high street stores across UK

Sky is to launch a network of high street stores across the UK, saying it wants them to become “social hubs for shoppers”, with the first one opening in Liverpool on Monday despite tier 3 coronavirus restrictions.

The plan to start a network of stores, each of which will have a music venue-style “access all areas” stage to host various interactive experiences for customers, comes amid the closure of hundreds of shops as the pandemic takes its toll on the retail sector.

“We are proud to see our shops opening at a challenging time for the UK high street,” said Stephen van Rooyen, the chief executive of Sky UK and Europe. “We’ll bring service, innovation and convenience all in one place, under one roof, at a time when keeping people connected has never been more important.”

The media group said: “All shops will operate in line with the government’s Covid-19 safety measures, including strict social distancing, mandatory face masks and hand sanitiser available across the sho.”

In May, Virgin Media said it would shut its last 53 retail stores and disappear from the UK high street. The cable TV company, which had 140 stores in 2016, said the pandemic had accelerated a shift towards online customer service.

Sky said the stores would differ from those of its rivals, going beyond simply operating as a sales point for its TV, mobile and broadband packages. It wants them to become a new social hub for shoppers.

It plans to launch about five of the stores this year, with further openings in 2021. The shops will also offer a mobile repair service through a partnership with iSmash, the technology repair chain that has 31 stores in 10 UK cities.

Despite the pandemic, there is still demand among customers seeking an in-store experience, particularly as technology becomes more complex and expensive.

Many consumers buying an iPhone for about £1,000 , for example, will want to go further than a website or phone call to make sure they are making the right choice.

Last October, BT launched a revamp its 615 retail stores across the UK using its high street presence to push its goal of being viewed as a British “national champion”. The relaunch of the EE store chain – BT acquired the mobile company for £12.5bn in 2015 – with co-branding marked the first time the BT brand has been on store fronts since 2004.

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Betting income returning to pre-Covid levels, says William Hill

William Hill has said betting income is gradually returning to pre-Covid levels but it expects to feel the effects of regional lockdowns as well as from a string of unpredictable results in sports being played behind closed doors.

The bookmaker, which is the subject of a £2.9bn takeover by the US casino company Caesars, reported third-quarter revenues that were 9% lower than the same period last year.

The result was a significant improvement on the first six months of the year, when it took 32% less from punters than in the first half of 2019, due to the cancellation of live sport and the prolonged closure of high street shops.

William Hill began the year with 1,533 shops and was already shrinking its bricks-and-mortar estate as customers moved online, along with managing the impact of a government-imposed reduction in maximum stakes on lucrative fixed-odds betting terminals.

Third of UK football fans put off buying kit if it has betting sponsor

It operated 1,414 shops during the third quarter as it moved the majority of its estate back into action following lockdown restrictions and said like-for-like sales were just 2% below last year as punters returned. But it said regional lockdowns such as those being imposed across the UK would hurt business.

A four-week lockdown of 100 shops would wipe £2m off operating profits, it said. At present, 10% of its retail estate – about 140 shops – is located in areas where the Covid alert level is classified as “very high”, signalling an ongoing drag on profits.

Bookmakers also rely on being able to estimate the likely winners of sports fixtures, in order to set appropriate odds. But the fact that sport has been played behind closed doors, without the psychological influence of fans on players, has given rise to some shock results.

In the Premier League, for instance, last year’s runaway champions, Liverpool, were thrashed 7-2 by Aston Villa, who spent much of last season battling relegation. William Hill said it expected the unpredictable results to continue.

“As a result, we continue to see volatile gross win margins, and we would expect this situation to continue,” it said.

Revenues in William Hill’s fledgling US business were up 10% and it said it expected to update the market on the takeover, which is subject to approval by shareholders, in due course. The bookmaker’s shares were flat by mid-morning on Wednesday at just under 280p, 8p above Caesars’ takeover price of 272p.

William Hill has typically lagged behind rivals in its online offering, where sales were up 4% in the UK and 6% internationally.

The Ladbrokes owner, GVC, posted online growth of more than 25% in third quarter figures released earlier this month.

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Philadelphia 76ers need Doc Rivers to fix its culture and win as the team eyes future business and a new arena

  • The Philadelphia 76ers hired their new coach, Doc Rivers, in Oct. 5.
  • Rivers is the former coach of the Los Angeles Clippers, owned by ex-Microsoft CEO Steve Ballmer.

Chief performance officer.

That's the label NBA insiders give Doc Rivers after his quick move from the L.A. Clippers to the Philadelphia 76ers.

Within one week, Rivers went from L.A. to Philly, from a team a team owned by ex-Microsoft CEO Steve Ballmer to another owned by Wall Street investor Josh Harris. Harris is the co-founder of private equity firm Apollo Global Management and co-owns the Sixers and New Jersey Devils with David Blitzer under the Harris Blitzer Sports and Entertainment company.

"Chief Performance Officer," one NBA executive said when describing Rivers' hire. "You have CEOs whose job is to present just message. Well, a head coach is more than just message – he's message and results."

The NBA executive agreed to speak to CNBC on the condition of anonymity due to the sensitivity of discussing team business.

"It's appropriate in this circumstance," added former NBA executive Andy Dolich when told of the "CPO" label.

And now, Rivers is the Sixers' new CPO. He's in charge of a Sixers roster that failed to meet expectations last season, the chatter of discontent among star players and the finger-pointing that comes along with it.

Behind the scenes, current and former NBA executives, including the New York Knicks executive Donnie Walsh, approve of the Rivers hire. 

Dolich, the former Memphis Grizzlies president of business operations, called it a "positive move" by Sixers ownership, "as long as they have the patience to deal with all the uncertainties that every NBA team is dealing with," thanks to Covid-19.

Rivers' new five-year contract is north of $40 million and includes incentives which trigger on team performance. If he can deliver a title for Philadelphia, the $280 million Harris and company invested in the Sixers could grow the valuation beyond its current $2 billion. But Rivers will face challenges, starting with fixing the product and making his own coaching adjustments when it matters most. 

Doc's leadership

After the team departed the NBA's bubble postseason in the first round in August, the Sixers fired Brett Brown. Sixers leadership, which includes HBSE CEO Scott O' Neil and team general manager Elton Brand, were mystified at the team's 31-4 home record but poor performance on the road at 12-26. As CPO, Brown paid the price.

One NBA team staffer with knowledge of the Sixers' affairs said the club lacked focus on the road and that the team's traveling party was too big. The staffer called the Sixers "unorganized," adding the club had too many front office staff with titles but undefined roles. 

Rivers, who turned 59 on Oct. 13, will also need to fix the Sixers' locker room and bond his franchise players in Ben Simmons and Joel Embiid. The Sixers are giving Rivers and Brand the keys to basketball operations decisions, banking on Rivers' history of fixing messy teams. 

Flashback to Rivers' second coaching job helping Danny Ainge transform the Boston Celtics who were finished with the Antoine Walker- Paul Pierce experiment. 

The Celtics traded Walker to Mark Cuban's Dallas Mavericks in 2003 and eventually won the NBA Finals in 2008. The team returned to the Finals in 2010, falling to the Kobe Bryant-led Los Angeles Lakers in Game 7.

With the Clippers, Rivers didn't meet expectations and secure a championship, but he did transition the team out of what many consider the black mark on the NBA's history – dismissing former owner Donald Sterling for racial remarks. Rivers is also credited with helping Ballmer navigate his first few years of NBA ownership. 

"Your head coach provides the narrative. That's why coaches like Doc Rivers are so damn good and why they cost so much money," said the executive, adding Ballmer would hire another good coach. "But he'll never find anybody better [than Rivers]."

On Thursday, the Clippers replaced Rivers with his assistant coach, Tyronn Lue, who will oversee a roster that blew a 3-1 lead against the Denver Nuggets in the playoffs. 

Comfort zones

Though Rivers is praised for fixing team culture, he'll also need to address his coaching. 

In the NBA, star players judge coaches by adjustments made especially in the playoffs. In league circles, Rivers is criticized for failing to adjust. It's here he'll need to be innovative with hiring assistants, as blowing 3-1 postseason leads is starting to follow him more than the 2008 championship.

During his Sixers introduction on Oct. 5, Rivers, now 91-89 in the postseason, was reminded about a quote printed in Sports Illustrated in 1999 while on his first coaching job with the Orlando Magic: "Winning is safe," Rivers said. "But if you want to be the winner, it means stepping out of that comfort zone."

Asked by CNBC if he plans to do just that – step out his comfort zone – and how he plans to get his star players to follow, Rivers responded: "I'm always changing. I'm always looking for different staff. I don't think you ever stop growing as a coach or as a person.

"If we're going to win, you just can't keep doing what you've always done and think you're going to get different results," Rivers continued. "You have to do something different. You have to give yourself to the team. You have to give something up."

Future business

If Rivers and Brand can help deliver Harris a championship, O'Neil's job could get a bit easier, as winning equals more business in the NBA. 

"It is the ultimate magnet of money," Dolich said. 

The Sixers bring in roughly $300 million in revenue, with $90 million from operating income, according to Forbes. The team is set with their broadcasting rights with Comcast property NBC Sports Philadelphia until 2029. Its radio media rights with Beasley Broadcast Group are also secure for another three years. 

O'Neil is credited for helping turn 3,500 season-ticket holders into roughly 14,000 – ranked first in the NBA in tickets sold and in attendance last season. He also landed the NBA's first jersey patch deal and landed Harris a $86 million new practice complex in Camden, New Jersey. 

And the Sixers are working with Philadelphia officials and Comcast, which owns the Wells Fargo Center, to host an NBA All-Star game in 2026.

But like others in the NBA's owners' club, including Ballmer, Harris wants a flashy new arena filled with better fan experiences once the club's lease ends in 2031. 

The building did go through a $250 million renovation, but newer arenas will require better 5G, Esports offerings, virtual and augmented reality engagement via sponsorship activation and more health technologies thanks to Covid-19.

The Sixers may also want to emulate the Washington Wizards' in-arena sportsbook play, as sports wagering is active in the state.

The team was rejected for its proposal to build a new complex in the city's Penn's Landing location, projected to bring $1 billion in jobs and training to the Philadelphia's Black community. 

The timeline to build arenas is usually seven years, so O'Neil will need it to navigate the politics and secure the funding, which could include tax dollars. 

Harris may envision a spacious site also to build hotels, restaurants, shops and apartments to surround the new arena, but if staying in Philadelphia is vital, the team could find itself settling for a downtown site.

Things become more manageable if the Sixers win a championship under Rivers. Dolich, also the former COO of the San Francisco 49ers, said the Sixers' new trio of Rivers, Brand, and O'Neil would need to have "unity" it leaves the "Trust the Process" era behind. 

"And if you don't have that going in, that's dangerous," he said. "If you have that unity, now Doc and Elton, more than Scott, they've got to deal with the chief product officer because what is most important is those feet on the court. 

Added Dolich: "The unity of those three has to translate to winning."

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.

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Federal inquiries, allegations of sexual assault, a resignation, and billions on the line: Here's everything you need to know about Nikola and its founder's controversial last 5 weeks

  • Automotive giant General Motors and electric vehicle startup Nikola announced a $2 billion deal in early September.
  • In the weeks since, Nikola and its founder, Trevor Milton, have been embroiled in controversy.
  • Since then, Milton has stepped down as the executive Chairman of Nikola's board, and has faced additional accusations including lying and sexual assault. 
  • Nikola's stock has been battered by the allegations of fraud, with prices down more than 50% since the deal was announced Sept. 8.
  • Negotiations are still underway between GM and Nikola. If the deal isn't done by December 3, then either side could walk away. 
  • Visit Business Insider's homepage for more stories.

In early September, automotive giant General Motors announced a $2 billion deal with electric-vehicle startup Nikola, with plans to produce the Nikola Badger, an electric pickup truck. But just two days after the deal was announced, a short seller released an explosive report claiming that Nikola faked its technological achievements, which spurred federal inquiries, a resignation, and speculation about the future of the deal.

Here's everything you need to know about the last month's controversy, and what it means for the future of GM, Nikola, and the electric truck they are looking to build.

The partnership begins: GM announces it's taking an 11% stake in Nikola on Sept. 8

On September 8, GM announced that it would begin a strategic partnership with Nikola in a $2 billion, all-stock deal. The terms of the agreement would see GM manufacture the startup's first pickup, the Badger, producing both the electric-battery and fuel-cell versions.

Do you work at GM or Nikola? Business Insider wants to hear from you. Contact the author of this report at [email protected] from a non-work email, or via secure messaging app Signal at 917-727-6830.

For Nikola, a contract with America's largest Original Equipment Manufacturer by sales boosted credibility, Wedbush analysts said, and its share prices. Following the announcement, Nikola's stock price jumped 53%, Markets Insider previously reported. 

For GM, the deal was supposed to pay for itself. Nikola would pay GM $700 million to engineer and manufacture the Badger, and in turn, GM could show off its Ultium battery in the new truck and collect 80% of the emissions credits for the vehicle. As part of the deal, GM would also be the exclusive provider of fuel cells for Nikola's semi-trucks, excluding Europe.

2 days later, Hindenburg Research released the explosive report, "Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America"

Hindenburg research announced that it gathered "extensive evidence" that it said indicated that "Nikola is an intricate fraud built on dozens of over the course of its Founder and Executive Chairman Trevor Milton's career" on Sept. 10. The firm has a short position on Nikola, which means that it stands to profit if Nikola's share price goes down.

The report said that Nikola made false or misleading claims about having proprietary battery technology, natural gas wells, solar panels, and hydrogen production capabilities. The report also said that while Milton claimed Nikola designed key components of its vehicles in house, the technology actually was licensed or bought from third parties.

In addition, Hindenburg Research said the Nikola's presentations of its semi-truck, the Nikola One, were "a total farce." During one event, the electric vehicle company claimed that the truck's electrical systems worked, but Hindenburg's report said that there was an electrical cable under the stage secretly powering the truck.

Nikola also promoted a video of the semi-truck cruising down a road, but Hindenburg's report said that the truck was towed to the top of a hill, and then filmed as it rolled down to make it seem like it had a working motor.

On Sept. 10, Trevor Milton called the report a "hit job" on Twitter, and teased a swift rebuttal. "Give me a few hours to put together responses to their lies," he wrote.

Four days after Milton's tweet, Nikola came out with an official statement saying Hindenburg's findings were "false and misleading," while stating that they never claimed that the truck in its promotional video was "under its own propulsion"

In a statement published September 14, Nikola released a detailed response to Hindenburg's report, saying that it "was designed to provide a false impression to investors and to negatively manipulate the market in order to financially benefit short sellers, including Hindenburg itself."

In response to Hindenburg's claims that Nikola misrepresented third-party technology, specifically inverters, as its own, Nikola said that it had been designing its own inverters, but it "does use third-party parts in prototype vehicles," and that it's "common practice among vehicle manufacturers."

Responding to Hindenburg's claims that it had faked the capabilities of its Nikola One semi-truck, Nikola didn't dispute the claim that the truck had been rolled down a hill. Instead, Nikola said that they had never claimed that the vehicle was moving "under its own propulsion" or "powertrain driven." 

The next day, Hindenburg wrote that, "the company debunked nothing," in a statement titled, "We View Nikola's Response As a Tacit Admission of Securities Fraud."

Regulators, including the SEC and the DOJ, began examining fraud allegations

On September 14, Bloomberg reported that the SEC was conducting a preliminary review to see if Nikola broke any securities laws. The next day, the Financial Times reported that the Department of Justice was looking into Hindenburg's allegations as well. 

"On September 11, Nikola's legal counsel proactively contacted and briefed the U.S. Securities and Exchange Commission (SEC) regarding Nikola's concerns pertaining to the Hindenburg report," a company spokesperson told Business Insider on Friday. "Nikola welcomes the SEC's involvement in this matter."

Despite the controversy, GM projected confidence about its decision to strike a deal with Nikola on Sept. 15

"We're a very capable team that has done the appropriate diligence," GM CEO Mary Barra said at an RBC event September 15, Business Insider's Matthew DeBord reported. Barra told attendees to go to Nikola with specific questions, but doubled down in her defense of GM's agreement with the startup, saying, "on the strength of the deal we put together, it validates our technology, it allows us to have more people using the technology, which gives us the advantage of scale, which will help us drive costs down."

Following the controversy, Trevor Milton resigned from his position as executive chairman on Sept. 20

"Nikola is truly in my blood and always will be, and the focus should be on the Company and its world-changing mission, not me," said Milton in a September 20 statement. "So I made the difficult decision to approach the Board and volunteer to step aside as Executive Chairman."

Stephen Girsky, who previously served on GM's Board of Directors, took over Milton's role.

As part of his sudden departure from Nikola, Milton, who is the largest shareholder of Nikola, gave up company equity valued at $166 million at the time,  a $20 million consulting contract with the company, while continuing to hold Nikola stock valued at $3.1 billion at the time, CNBC reported. Nikola will also cover Milton's legal fees, under certain stipulations.

Later that day, Milton's cousin accused him of sexually assaulting her

Aubrey Smith told Business Insider that Milton assaulted her in 1999, after their grandfather's funeral service. Smith was 15 and Milton was 17, according to prior Business Insider reporting. Under the guise of giving her a massage, Milton took off Smith's bra without her consent and then groped her, Smith said. 

In the weeks following Smith's allegation, another woman came forward accusing Milton of sexual assault, CNBC reported. She alleged that Milton digitally penetrated her against her consent in 2004 when she was 15 and he was 22. She was an employee at his security company at the time, her lawyer told CNBC. 

Milton denied both of the claims in a prior statement to Business Insider. "At no point in his life has Mr. Milton ever engaged in any inappropriate physical contact with anyone," Milton's representative wrote.

"The Nikola Board first learned of these allegations, regarding conduct from before Nikola was founded, from tweets and media reporting that occurred subsequent to the company's announcement that Trevor Milton was stepping aside as Executive Chairman," a Nikola representative told Business Insider. "Nikola has been and remains committed to creating a safe, respectful, and inclusive work environment for all employees and has established policies and procedures to instill these values throughout the company."

A report surfaces Sept. 26 alleging Trevor Milton purchased the designs for the Nikola One semi-truck, rather than designing it himself "in his basement," as previously claimed

The Financial Times reported that the founder purchased the design for the Nikola One from Adriano Mudri, a designer employed at the Croatian electric vehicle brand Rimac Automobili. Nikola had previously claimed that Milton had created the design for the truck himself in a 2018 lawsuit against Tesla. 

"The Nikola One truck was designed and patented by Nikola. It is commonplace to license third-party designs during vehicle development, and although early in the process, Nikola purchased a license to Adriano Mudri's designs," a Nikola representative told Business Insider on Friday.  "He was not part of the design team, and his designs are materially different from the design invented by Nikola for the Nikola One."

Negotiations are still underway for the deal between GM and Nikola. The companies missed their Sept. 30 initial target date for finalizing the agreement.

Nikola's share price has been battered by the fraud allegations, with shares of Nikola down 53% since the partnership was announced, as of Thursday. CNBC's Phil LeBeau reported Sept. 30 that GM might take a bigger stake in Nikola, given the fact that Nikola's share price has dropped precipitously since the deal was announced. GM's proposed 11% stake was worth about $2 billion when the deal was penned. Now, it's worth less than half that much. 

"Our transaction with Nikola has not closed," a GM rep said on September 29, according to Reuters. "We are continuing our discussions with Nikola and will provide further updates when appropriate or required."

On Thursday, a Nikola executive "played down" the significance of the Badger project, the Financial Times reported. "The Badger was an interesting and exciting project to some shareholders, but our institutional shareholders are mostly focused on the business plan," said Nikola's CEO Mark Russell, according to the Financial Times. Russell also said Thursday that the Badger wouldn't be built without an OEM partner like GM, according to Bloomberg. Russell also told Bloomberg that the company can carry on even if the GM deal falls apart. 

GM did not immediately respond to a request for comment.

"Nikola continues to work with GM towards a closing and will provide further updates when appropriate or required," a Nikola representative told Business Insider on Friday.

If the deal isn't done by Dec. 3, either company could walk away. 

Do you work at GM or Nikola? Business Insider wants to hear from you. Contact the author of this report at [email protected] using a non-work email, or via the secure messaging app Signal at (917) 727-6830.

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Kansas City Southern CEO sees 'modestly strong' economic recovery continuing this year

  • "Across our industrial and consumer economy, we think it's going to continue to be modestly strong from this point through the end of the year," the CEO of Kansas City Southern told CNBC Friday.
  • Shares of the railroad operator closed down 2.7% to $179 apiece after it reported third-quarter earnings.
  • Kansas City Southern missed on revenue estimates but beat per-share earnings forecasts and hiked its full-year guidance.

The CEO of Kansas City Southern told CNBC on Friday he sees the company's recovery from coronavirus business lows continuing for the rest of 2020, an optimistic sign for the broader U.S. economy.

The railroad operator reported third-quarter earnings earlier in the day, posting revenues of $660 million that missed Wall Street estimates of $663 million. However, Kansas City Southern's per-share earnings of $1.96, excluding items, was better than the profits per share of $1.90 analysts had forecast.

"Across our industrial and consumer economy, we think it's going to continue to be modestly strong from this point through the end of the year," CEO Patrick Ottensmeyer said on "Closing Bell."

Kansas City Southern also raised its full-year guidance Friday, saying it expects earnings per share to be slightly higher on a year-over-year basis. Shares of the company closed down 2.72% Friday to $179 apiece. The stock is up nearly 17% this year.

Carload volumes were down 4% in the third quarter compared with the year-ago period. But that is improving, Ottensmeyer said. "We're up a little bit from last year and certainly above pre-Covid levels," he said.

Railroad operators, with their exposure to multiple different industries, are often seen as bellwethers for the economy. The U.S. has added millions of jobs back in recent months after steep employment cuts from the pandemic, and sectors such as housing have seen impressive strength. However, there are questions now about the resilience of the recovery, especially as Congress has been unable to come to terms on another round of stimulus.

Ottensmeyer said Kansas City Southern's strongest segment has been refined petroleum products, largely driven by moving fuel from Gulf Coast refineries into Mexico. The company also has experienced strength in its automotive segment, he said, as the auto industry rebounded from the coronavirus slowdown.

On the other hand, Ottensmeyer said Kansas City Southern has seen weakness in its intermodal volumes, which involve multiple modes of transportation. He said they're lagging the industry there and "that has to do with some service interruptions, some issues going on in Mexico that we're trying to deal with that have caused us to lose some business, at least for some period of time."

In general, Kansas City Southern has seen an "incredible" V-shaped recovery on its shipping volumes from pandemic lows, according to Ottensmeyer. He said the last few months have been like a roller coaster "if you think about the things we needed to do, not knowing what was ahead, with volumes falling that quickly and that dramatically in the second quarter, and then bouncing back 90 days later."

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PwC stepping down as auditor of Boohoo over governance concerns

PricewaterhouseCoopers is stepping down as auditor of Boohoo’s financial accounts as the fast fashion firm faces scrutiny over malpractice in its supply chain. According to the FT, PwC resigned its role, held since 2014, over concerns about governance at Boohoo.

However, a Boohoo spokesperson said: “PwC has not resigned as auditor to Boohoo, but a process has recently commenced to tender for a new provider of audit services.”

The auditor is stepping down after a damning review, conducted by Alison Levitt QC, that criticised the “weak corporate governance” at Boohoo.

Levitt’s review – commissioned after an investigation by the Guardian revealed evidence that factories in Leicester were putting workers’ health at risk during lockdown and failing to pay them the minimum wage – found that the allegations of poor working practice were were “substantially true”.

Boohoo, the audits and an industry under the spotlight

The brand has pledged a series of reforms, including a move to publish a full list of companies in its supply chain, reducing the number of factories it relies on, and using new, ethical suppliers.

Boohoo has also faced controversy over an executive pay plan that would hand bosses £150m if shares in the online fashion retailer rise by two-thirds over the next three years. Co-founders Mahmud Kamani and Carol Kane would each receive £50m, or a third of the payout.

Boohoo is breaking with the UK corporate governance code and electing not to put the plan to a shareholder vote. It says under two different sets of company rules, the QCA corporate governance code and AIM rules, a vote is not necessary.

The latest bonus plan is separate from one that the company created for the chief executive, John Lyttle, when he was poached from Primark in 2018. Lyttle will receive a £50m bonus if the company’s market value hits £5.6bn by 2024.

PwC declined to comment.

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Cramer's lightning round: 'I'm not going to fight you if you like Nio'

  • It's that time again! "Mad Money" host Jim Cramer rings the lightning round bell, which means he's giving his answers to callers' stock questions at rapid speed.

Crown Castle: "People are upset that this thing hasn't just soared higher. I say, give it a little time. C'mon, these stocks have been great for a long time and [Elliott Management]'s in there, I'm saying buy it."

SolarEdge Technologies: "If you've taken off your initial investment and you're playing with house's money, no, you keep running it. All the solar stocks are going nuts, and what can I say, they've got a bunch of new ones, too. First Solar's high. But people love solar. It's gotten economic."

Sunrun: "It's going higher. Blackstone, they offered the stock $61, $62. It's going to be a buy. I hate recommending stocks because they're hot. The sun's hot. They're hot. But they're working."

Nio: "Oh my god, Nio. OK, so Nio was down … it's been a straight line up. Nio is the Tesla of China. I've been recommending Alibaba, that's been my Chinese play. But I recognize Nio has been a hot one. I'm not going to stick my neck out, but I'm not going to fight you if you like Nio."


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