How some restaurants are reacting to CDC guidance: Masks indoors, proof of vaccination

halbergman/ iStock

(NEW YORK) — Bars and restaurants are once again at the forefront of a polarizing business decision 16 months into the pandemic: Whether or not they should require patrons to wear masks inside or show vaccination status in order to dine safely.

Parts of the country are bracing for change after the Centers for Disease Control and Prevention (CDC) recommended Wednesday that vaccinated Americans wear masks indoors in areas with high COVID-19 transmission rates due to the increasing spread of the delta variant. The agency did not publish new research but cited, “CDC COVID-19 Response Team, unpublished data, 2021.”

From coast to coast the restaurant industry has been hard-pressed to follow ever-changing health protocols throughout the pandemic to keep both staff and customers safe, but even with 49.5% of the country fully vaccinated, according to the Mayo Clinic, there is not a one-size-fits-all solution.

Restaurateur Danny Meyer, CEO and founder of Union Square Hospitality, announced Thursday that his restaurants in Washington, D.C., and New York City will require patrons dining and drinking inside to show they have been fully vaccinated starting Sept. 7. Guests can bring the physical COVID-19 vaccine card, a New York State Excelsior Pass, relevant state-provided vaccine pass, or a photo of their vaccination card to share upon arrival.

Although it’s also part of his group, the Shake Shack founder said the policy does not yet extend to the popular burger chain.

“As everything opened up, there was a lot of reason for cautious optimism, but the increase of the delta variant infection rates is causing alarm for many,” Andrew Rigie, executive director of the NYC Hospitality Alliance, told ABC News. “Some restaurants have or will implement vaccination policies for workers and in some cases customers, but that poses challenges.”

Proof of a vaccine or facial coverings are ultimately up to the business owners who are looking out for the best interests of workers and the communities they serve.

For specific restaurants such as ones in a community with lower vaccination rates, Rigie said “different restaurants are situated differently and have different abilities. If most of your customer base is vaccinated and you have resources to check vaccination status, it’s not easy, but it’s easier than being a small business in a community with hesitancy or lower vaccine rates.”

He added, “Collectively I think we understand we need to do everything possible not to revert to new mandates and restrictions after the restaurant industry has been economically devastated so far.”

For first-time restaurant owner Patricia Howard, who opened an intimate seafood restaurant Dame to rave reviews in June, she said she has “anxiously watched the infection rate creep back up” and wants to remain vigilant for both diners and staff.

“We can’t control whether the person next to us on the subway is wearing a mask, but we can control who gets to come through our doors at Dame,” she told ABC News. “With two members of our staff immunocompromised and the very small size of our space, it is better to air on the side of caution. We were nervous about potential backlash, but once the city announced all municipal workers are required to be vaccinated, we felt more confident that it’s the right thing to do regardless of the response.”

The small team at Dame emailed diners who had upcoming reservations earlier this week about requiring proof of vaccination and Howard said they “only had to cancel a few reservations, due to one or more guests being unvaccinated thus far.” She added that nearly all guests have been appreciative and supportive with hundreds of unexpected replies “thanking us for keeping our community safe, saying it makes them even more excited to dine at Dame, and hoping other restaurants follow suit.”

In California, even before the latest CDC guidance, some bars in Los Angeles County, as well as the Bay Area, have taken preventative steps, asking for proof of vaccination or a negative COVID test 72 hours before dining.

Starting Thursday, bars that are part of The San Francisco Bar Owner Alliance may ask customers who wish to be inside to show proof of vaccination. While not mandated by the government, Ben Bleiman, president of the local industry group and owner of Soda Popinski’s and Teeth bars, said this is a step they needed to take “to protect our staff and families.”

Other industry leaders like Oregon-based Erika Polmar, executive director of the Independent Restaurant Coalition, stressed that this new wave of rules and recommendations could become “confusing and burdensome” for both restaurants and diners.

“It’s really challenging to walk into one place and not see a mask mandate and then just a block or two away the mask rules are different,” Polmar explained. “The requirements vary county to county and the public doesn’t know where a county line is.”

Polmar emphasized that if diner attendance dips again, government financial assistance will be crucial and she is imploring Congress to quickly allocate money again for the Restaurant Revitalization Fund.

“I think if you were to talk to any restaurant owner across the country they would be even more heartbroken that they’re not seeing the replenishment of the RRF” despite support in the House and Senate, she said. “The urgency isn’t being acted upon.”

She continued, “Restaurants are accepting the hard truth that Congress might not act until September and that’s amplifying the devastation they’re feeling.”

Copyright © 2021, ABC Audio. All rights reserved.

White House unveils new strategy to address ‘root causes’ of migration

Anna Moneymaker/Getty Images

(WASHINGTON) — The Biden administration on Thursday announced a new strategic framework aimed at reducing and managing conditions in Central America that have caused unprecedented levels of migration in recent years.

The strategy resembles much of what the administration has already proposed and focuses on reducing poverty, combating corruption and addressing violence in El Salvador, Honduras and Guatemala. The administration previously dedicated $4 billion in financial support to the region, later saying that substantial portions of the money would not go to Northern Triangle governments and instead would be distributed among nonprofits and aid organizations.

Specifically, the five-point plan aims to address economic instability, establish anti-corruption measures with the involvement of U.S. officials, prioritize human rights and labor rights, counter and prevent gang violence and other organized crime while also targeting gender-based violence.

“We’re not seeking to end migration,” a senior administration official told reporters. “It’s part of the fabric of this region, we have so many familial cultural ties to Central America. But we’re seeking to change the ways in which people migrate, provide an alternative to the criminal smuggling, smuggling and trafficking rings, and to give people access to opportunity and protection through safe legal channels, safe legal pathways.”

The strategy is being led by Vice President Kamala Harris who was tasked by Biden earlier this year with addressing the root causes of migration. In announcing the new framework, Harris said the United Nations and Mexico, among others, have committed support.

The administration is also looking to countries like Canada and Costa Rica, one official said, in an effort to provide more options for asylum and refuge.

The announcement comes as Biden continues to try to unwind the immigration enforcement policies of his predecessor, including recently making it easier for migrants to seek humanitarian relief. The Department of Justice announced this week the reversal of another Trump-era policy that immigrant advocates, student organizations and law professors said was part of the prior administration’s limiting of humanitarian protections.

Attorney General Merrick Garland formally rescinded a decision from his predecessor, Attorney General William Barr, which required the Board of Immigration appeals to completely re-decide immigration petitions and asylum cases even if a defendant had made progress in establishing their case. The Barr decision, now reversed, was also expected to exacerbate the growing backlog of cases in immigration court.

A group of more than 350 law firms, professors and advocacy organizations called on the Biden administration earlier this year to repeal a series of decisions made under the Trump administration which limited avenues for migrants to receive a grant of asylum. Monday’s announcement was the final decision to be reversed in that series.

The Biden administration had already reversed a decision from former Attorney General Jeff Sessions that domestic violence and gang violence were not grounds for asylum claims.

The new strategy from Harris also places an emphasis on making humanitarian relief opportunities available in the home countries of would-be migrants. It’s an essential component of reducing the migratory traffic at the U.S. southern border, which has become flooded with asylum-seeking children and families in recent months.

Copyright © 2021, ABC Audio. All rights reserved.

Pilot reports ‘possible jet pack man’ near Los Angeles

hudiemm/iStock

(LOS ANGELES) — A Boeing 747 pilot near Los Angeles reported Wednesday night another “possible jet pack man in sight.” It’s the latest in a string of mysterious jet pack sightings near the City of Angels since last year.

“A Boeing 747 pilot reported seeing an object that might have resembled a jet pack 15 miles east of LAX at 5,000 feet altitude around 6:12 p.m. Wednesday,” a spokesperson for the Federal Aviation Administration told ABC News. “Out of an abundance of caution, air traffic controllers alerted other pilots in the vicinity.”

Air traffic controllers could be heard directing pilots in the area to “use caution towards the jet pack.” The FAA spokesperson said there were no “unusual objects” that had appeared on the radar around LAX around that time on Wednesday.

“We were looking but we did not see Iron Man,” one person said on the air traffic recording.

The supposed jet pack sighting follows several others dating back to early 2020. In December 2020, a Southern California pilot captured a video of what appeared to be a person with a jet pack flying off the Palos Verdes Peninsula at around 3,000 feet.

Another sighting was reported in August 2020, after two different commercial airline pilots reported seeing a man in a jet pack hovering near LAX, ABC News reported.

“Reports of unmanned aircraft sightings from pilots, law enforcement personnel and the general public have increased dramatically over the past two years,” the FAA said on its website.

The agency says it receives more than 100 such reports each month.

Unauthorized operators flying around airplanes, helicopters and airports is illegal and may be subject to fines and criminal charges, including jail time, the FAA Says. The FAA spokesperson said the agency works with the FBI to investigate these sightings.

“The FAA has worked closely with the FBI to investigate every possible jet pack sighting report,” said the spokesperson. “We have not been able to validate any of the reports.”

ABC News’ Alex Stone and Mina Kaji contributed to this report.

Copyright © 2021, ABC Audio. All rights reserved.

With eviction moratorium expiring Saturday, Biden calls on Congress to act

Bill Oxford/iStock

(WASHINGTON) —The Biden administration on Thursday called on Congress to extend a federal freeze on evictions set to expire on Saturday, arguing its hands are tied by the Supreme Court.

The new statement comes as the country grapples with a COVID-19 surge fueled by the highly contagious delta variant.

The moratorium, essentially a nationwide ban on evictions, was put in place by the Centers for Disease Control and Prevention last September. In June, the Supreme Court voted 5-4 to allow the eviction ban to continue through the end of July but signaled in its ruling that it would block any further extensions unless there was “clear and specific congressional authorization.”

Amid public outcry, House Democratic leadership was looking to possibly take legislative action by the end of the week, before legislators leave for a six-week recess, to extend the freeze until the end of December, ABC News was told. Senate Democrats were also preparing legislation to extend the moratorium for the same duration, according to a Democratic aide.

“Given the recent spread of the Delta variant, including among those Americans both most likely to face evictions and lacking vaccinations, President Biden would have strongly supported a decision by the CDC to further extend this eviction moratorium to protect renters at this moment of heightened vulnerability,” White House press secretary Jen Psaki said in a statement Thursday.

“Unfortunately, the Supreme Court has made clear that this option is no longer available. In June, when CDC extended the eviction moratorium until July 31st, the Supreme Court’s ruling stated that ‘clear and specific congressional authorization (via new legislation) would be necessary for the CDC to extend the moratorium past July 31,'” she added, citing Justice Brett Kavanaugh’s concurring opinion.

By a vote of 5 to 4, the court rejected a request from two associations of relators in Alabama and Georgia and group of property management companies seeking an emergency injunction against the CDC, which imposed the moratorium.

The Biden administration had previously said it would not extend the moratorium beyond July, so the Court allowed the moratorium to remain in place, though Justice Kavanaugh made clear that he and the other conservative justices believe the CDC exceeded its authority.

“In light of the Supreme Court’s ruling,” Psaki continued, “the President calls on Congress to extend the eviction moratorium to protect such vulnerable renters and their families without delay.”

In the meantime, Biden has asked the U.S. Department of Housing and Urban Development, Department of Agriculture and Department of Veterans Affairs to each extend their respective eviction bans through the end of September, which Psaki said “will provide continued protection for households living in federally-insured, single-family properties.”

“The President has also asked these and other departments to do everything in their power so that owners and operators of federally-assisted and financed rental housing seek Emergency Rental Assistance to make themselves whole while keeping families in secure and safe housing — before moving toward eviction,” she added.

Psaki described the federal eviction moratorium as a “critical backstop to prevent hard-pressed renters and their families who lost jobs or income due to the COVID-19 pandemic from being evicted for nonpayment of rent.”

“This moratorium prevented hundreds of thousands of Americans from experiencing the heartbreak, homelessness, and health risks that too often emanate from evictions — particularly during a pandemic,” she said.

The Biden administration has faced mounting pressure from some Democratic lawmakers to address the looming deadline amid growing concerns that vaccinated people can spread the delta variant to others — evidence of which has prompted the CDC to advise vaccinated Americans to wear face masks indoors in areas with high or substantial levels of COVID-19 transmission.

“I urge the Biden Administration to extend the CDC’s eviction moratorium. It is reckless not to extend the deadline when rental assistance funds have not gone out fast enough to protect people. Eviction filings have already spiked in anticipation of the moratorium being lifted,” Rep. Alexandria Ocasio Cortez, D-N.Y., tweeted on July 23.

When asked during Tuesday’s press briefing if the Biden administration was discussing an extension of the nationwide eviction ban, Psaki had little to add.

“I don’t have anything to preview for you at this point in time,” she said. “But certainly, we will be watching this closely,” she added, citing “ongoing discussions about how we can continue to help renters.”

ABC News’ Mariam Khan and Trish Turner contributed to this report.

Copyright © 2021, ABC Audio. All rights reserved.

Senate passes emergency security funding for Capitol Police, National Guard

krblokhin/iStock

(WASHINGTON) —The Senate swiftly passed the $2.1B emergency security supplemental bill Thursday in a rare unanimous vote.

The bill now heads to the House for expected passage this week. Then it heads to the president for his signature.

The move staves off critical funding cuts that both the U.S. Capitol Police and National Guard were expected to enact following weeks of congressional inaction. Both forces were crushed by the emergency needs in the wake of the Jan. 6 insurrection, each relying on Congress to reimburse them in the months after the attack.

But some Republican lawmakers argued that after spending trillions to battle the pandemic, it would be irresponsible to spend billions more without enacting spending cuts to cover the expenses.

The emergency supplemental bill also has $1.125 billion to cover the Afghanistan Special Immigrant Visa program — a little less than what the White House requested — to provide asylum to allies there who aided the U.S. mission and now face retribution from a resurgent Taliban.

Sen Mike Braun, R-Ind., said, “We need to protect our National Guard — and we will. And we need to protect our allies who kept our troops safe, and we will. Emergencies arise and the biggest threat to dealing with them in my opinion is fiscal irresponsibility in D.C. We could have easily paid for the major parts of this legislation with offsets within the DOD.”

This is a developing news story. Please check back for updates.

Copyright © 2021, ABC Audio. All rights reserved.

Retail trading app Robinhood makes its Wall Street debut on the Nasdaq

guvendemir/iStock

(NEW YORK) — Investing platform Robinhood officially became a publicly-listed company Thursday, making its Wall Street debut on the Nasdaq under the trading ticker $HOOD.

Robinhood co-founders Vlad Tenev (the current chief executive officer) and Baiju Bhatt (the chief creative officer) rang the Nasdaq’s opening bell in Times Square on Thursday morning, surrounded by colleagues and family members. Tenev carried his young daughter on his hip as his company made its initial public offering.

Trading opened to the public at $38 per share, giving it a valuation of some $32 billion. By mid-day the stock fell slightly, trading at around $35 per share.

Robinhood exploded in popularity amid the COVID-19 pandemic as swaths of retail investors turned to its commission-free trading services. It became embroiled in controversy amid the GameStop short-squeeze, when an army of retail investors attempted to take on Wall Street firms that were betting against the video game retailer.

As individual investors pushed the price of GameStop shares up, Robinhood and other trading platforms abruptly halted trading of the stock — leading to allegations they were doing so at the urging of hedge funds and short sellers. The company has denied this, saying the temporary halt was due to clearinghouse-mandated deposit requirements that skyrocketed amid the volatility.

Still, Robinhood’s Tenev was called to testify before lawmakers and the fallout of the GameStop saga left Wall Street reeling for months.

Robinhood has repeatedly said its mission is to “democratize finance for all.” The firm on Thursday celebrated what it saw as bringing its Main Street clientele to Wall Street via its Nasdaq listing. Some 50% of Robinhood users are first-time investors.

“The U.S. stock market is one of the world’s greatest sources of wealth creation. But for generations, it was out of reach for most people,” Tenev and Bhatt said in a joint statement Thursday celebrating the IPO. “Robinhood changed that — we’ve built investing products for everyday people, to put them in control of their financial futures.”

“Our listing day is a celebration of our customers — Generation Robinhood,” the statement added. “Through Robinhood, millions of everyday people have started investing in the stock market for the first time.”

Tenev and Bhatt said these new everyday investors are “making their voices heard through the markets, transforming our financial system in the process.”

Copyright © 2021, ABC Audio. All rights reserved.

Biden’s federal workforce vaccine mandate could inspire companies to follow suit

Flickr/The White House

(WASHINGTON) — The Biden administration’s vaccine mandate for federal workers could set the groundwork for more private sector organizations to follow along. But it also is likely to trigger an avalanche of lawsuits from those who say required vaccinations infringe on the civil liberties of Americans.

President Joe Biden is expected to announce on Thursday a plan requiring all federal workers to be vaccinated or comply with “stringent COVID-19 protocols like mandatory mask wearing — even in communities not with high or substantial spread — and regular testing.”

The U.S. Equal Employment Opportunity Commission says that employers can require their employees to be vaccinated with exceptions being granted for religious and medical reasons.

Federal law does not bar organizations from mandating coronavirus vaccines even as the publicly available vaccines have yet to receive full authorization from the Food and Drug Administration, according to a Justice Department memo.

But some legal scholars say that full approval from the FDA would give companies increased legal cover from employees who refuse to comply with a vaccine mandate.

“There are many companies that are worried about pushback litigation and are waiting for full FDA approval,” said Larry Gostin, a professor of global health law at the Georgetown University Law Center and director of the World Health Organization Center on Public Health Law and Human Rights.

Full FDA vaccine approval is expected in September, according to a federal official. Normally, full approval takes up to a year following the submission of all required data.

Gostin added that employers also have the right to terminate employees who do not comply with their company’s vaccine mandate.

“A worker doesn’t have a legal or ethical entitlement to go unvaccinated or unmasked in a crowded workplace,” he said. “They can make decisions for their own health and well-being, but they can’t pose risk to others. Somebody who is unvaccinated and isn’t tested and unmasked poses a very substantial risk of transferring a very dangerous, if not deadly, disease.”

Similar to the legal arguments over state mask mandates, the debate surrounding vaccine mandates is an issue widely expected to end up in court.

“America is a very litigious society and there will be lawsuits,” said Gostin. “But employers and particularly hospitals are on very firm legal grounding and will win those lawsuits.”

While the Biden administration’s vaccine mandate for federal workers could inspire similar moves from large employers to local governments, some states are taking offensive measures.

Several states including Arkansas, Tennessee, Utah, and Montana have already passed legislation banning COVID-19 vaccine mandates and vaccine passports, according to the National Academy for State Health Policy.

And with return to school quickly approaching for millions of U.S. students, some legislatures have even sought to prohibit required COVID-19 vaccines for school attendance.

The Federal Law Enforcement Officer’s Association, which consists of FBI agents and U.S. Marshalls, however, sees the Biden administration’s vaccine mandate for federal employees as an attack on civil liberties.

“Forcing people to undertake a medical procedure is not the American way and is a clear civil rights violation no matter how proponents may seek to justify it,” said Larry Cosme, the association’s president, in a statement.

The idea of employer vaccine mandates is something that many public health experts increasingly agree on. A large number of companies are still allowing employees back to the office based entirely on voluntary employee disclosure of vaccination status as opposed to requiring actual proof of vaccination.

“An honor system can work in a situation where you don’t have an epidemic,” said Dr. Wafaa El-Sadr, a professor of epidemiology and medicine at Columbia Mailman School of Public Health. “We need to realize that we are in an emergency, and we have to do everything possible to ensure that the vast majority of people get vaccinated.”

Google, Apple and Facebook all postponed their return to office plans for mid-October as the delta variant continues to drive a dramatic rise in COVID-19 cases and hospitalizations nationwide.

Google’s decision to require staff in their offices to be vaccinated comes after similar announcements impacting government workers in New York and California to curb the spread of the delta variant.

“The timing for these vaccine mandates is right and it’s actually a bit long overdue,” said El-Sadr.

Copyright © 2021, ABC Audio. All rights reserved.

Vast majority of ICU patients with COVID-19 are unvaccinated, ABC News survey finds

iStock/CarmenMurillo

(NEW YORK) — With the country in the midst of a new nationwide resurgence of coronavirus infections and hospitalizations, misinformation about the effectiveness of the vaccines has been proliferating on social media, with increased attention falling on the rare number of vaccinated people ending up in the intensive care unit (ICU). However, according to dozens of hospitals across the nation surveyed by ABC News, very few fully vaccinated people are actually ending up severely ill and in the ICU with COVID-19.

And experts say that those that do, tend to be frail or have conditions that interfere with the vaccine’s effectiveness at producing protection.

ABC News contacted 50 hospitals in 17 states, and asked them to share data on their ICU wards’ current COVID-19 patients, including their vaccination status. In the surveyed hospitals, ABC News found that the overwhelming majority of COVID-19 patients currently being treated in ICUs were unvaccinated.

Of the 271 total COVID patients in the surveyed ICUs, 255 patients, or approximately 94%, were unvaccinated against COVID-19 in ABC News’ snapshot in time.

Further, of the 16 vaccinated individuals receiving care in the ICU, almost all suffered from comorbidities and other health problems, such as cancer or weakened immune systems. ABC News only heard of one otherwise healthy and fully vaccinated individual, with no reported underlying conditions, who was in the ICU.

According to the CDC, “vaccine breakthrough cases are expected,” and, as a result, “there will be a small percentage of fully vaccinated people who still get sick, are hospitalized, or die from COVID-19.” But data about ICU patients’ vaccination status is not regularly reported or readily available on the federal or state level.

“The current surge of COVID-19 is driven by those who have elected not to be immunized. We will continue to see the lopsided impact of COVID among the unvaccinated, as they represent the vast majority of severe illnesses, hospitalizations and deaths,” said ABC News contributor Dr. John Brownstein, chief innovation officer at Boston Children’s Hospital.

The hospital sampling also appears to be reflective of a national trend. According to the White House COVID-19 Task Force, severe breakthrough infections remain uncommon, and nearly all of the patients who are currently hospitalized with COVID-19 — 97% — are unvaccinated.

Dr. Lew Kaplan, past president of the Society of Critical Care Medicine and professor of surgery at the University of Pennsylvania’s Perelman School of Medicine, said that the ABC News survey data “provides crystal clear guidance regarding the SARS-CoV-2 delta variant — that vaccines work.”

Furthermore, said Kaplan, the very fact that “the overwhelming majority of hospitalized critically ill patients with this viral variant are unvaccinated, should drive our nation to relentlessly pursue vaccination of every eligible individual.”

“It is our duty and our privilege to save lives,” Kaplan said. “The COVID-19 vaccine is staggeringly effective in helping us keep people at home and alive.”

Front-line workers support the numbers

ABC News’ findings are also supported by local data. In Springfield, Missouri, county health officials reported this week that since vaccines became available, 96.5% of those who have died of COVID in the community were not fully vaccinated.

Mercy Hospital nurse Emily McMichael said the county’s findings are supported by what she’s been seeing.

“These patients are a lot sicker and a lot younger than what we saw the last go around, so it’s just really sad to see,” McMichael said. “And a lot of the population is unvaccinated.”

In Alabama, which has the lowest vaccination rate in the country, 94% of current COVID-19 hospitalized patients are unvaccinated according to state statistics — and hospital admissions are six times higher than they were just a month ago, as health care workers report an influx of COVID-positive patients in need of care.

The University of Alabama at Birmingham Hospital has seen “an explosion of cases,” with the number increasing tenfold in the last three weeks, according to Dr. Kierstin Kennedy, chief of hospital medicine.

The patients who are currently hospitalized, Kennedy said, are younger than those who were hospitalized during the last surge — but unfortunately, they are just as sick. The vast majority of those patients are unvaccinated, she said.

Similarly, in Florida, state statistics show virus-related hospitalizations are nearly at their highest point since the onset of the pandemic, with more than 1,200 COVID-19 patients being admitted to the hospital every day.

“This is heartbreaking because all this could have been avoided; this is unnecessary human suffering that we are witnessing right now,” said Dr. Seetha Lakshmi, medical director of the Global Emerging Diseases Institute at Tampa General Hospital, where she said “almost all” patients are currently unvaccinated.

Another Florida physician said he believes low vaccination rates are one of the driving factors behind the state’s significant increase in COVID-19 patients.

“The vaccine is really protective in terms of being hospitalized or in terms of dying, and the people we’re seeing that are sick, ending up on ventilators and ending up hospitalized, are unvaccinated patients,” Dr. David Wein, emergency room physician at Tampa General, told ABC News.

ABC News’ Sony Salzman, Eric Strauss, Alexis Carrington, Chidimma Acholonu, Odelia Lewis, Priscilla Hanudel, and Dr. Jay Bhatt contributed to this report.

Copyright © 2021, ABC Audio. All rights reserved.

Trevor Milton, founder of electric truck startup Nikola, hit with securities fraud charges

iStock/RapidEye

(NEW YORK) — Trevor Milton, the billionaire founder of electric truck manufacturer Nikola, was hit with securities fraud charges from federal prosecutors in New York City on Thursday.

In a nearly 50-page indictment, prosecutors accused Milton of preying on vulnerable retail investors who had turned to trading after losing income due to the pandemic. In some cases, these victims lost their retirement savings, authorities said, as they outlined his web of false promises related to an electric truck that was never operable.

“Milton’s scheme targeted individual, non-professional investors — so-called retail investors — by making false and misleading statements,” the indictment said.

Milton is in custody and due to appear later Thursday.

Authorities had been investigating Milton and Nikola for more than a year after short seller Hindenburg Research called the firm an “intricate fraud” in a September report.

The company subsequently conceded video of its electric truck gave a misleading impression it was actually drivable. The company also said Milton had made inaccurate statements about the technology behind the vehicle. Federal prosecutors agreed.

The false promotional video for the semi-truck prototype known as Nikola One was referenced heavily in the indictment. The concept included a shot of the Nikola One coming to a stop in front of a stop sign, according to the indictment.

“In order to accomplish this feat with a vehicle that could not drive, the Nikola One was towed to the top of hill, at which point the ‘driver’ released the brakes, and the truck rolled down the hill until being brought to a stop in front of the stop sign,” prosecutors wrote. “For additional takes, the truck was towed to the top of the hill and rolled down the hill twice more.”

Moreover, the door had to be taped to the vehicle during the shoot “to prevent it from falling off,” prosecutors wrote. Batteries were also entirely removed from the vehicle during the shoot, which was attended by Milton. According to prosecutors, this was to “mitigate the risk of fire, explosion, or damage.”

Phoenix-based Nikola planned to build battery- and hydrogen-fuel-cell-powered heavy trucks for long-haul trucking and the company had been valued at more than $12 billion dollars. The doubts raised by short sellers and regulators have tanked the stock price and scuttled a deal with General Motors to take a stake in the company.

Prosecutors said Milton lied at every turn about the company’s ability to produce its electric truck.

According to the indictment, Milton made false and misleading statements about the company’s success in creating a fully-functioning Nikola One prototype when he knew that the prototype was inoperable. He also made false statements about an electric and hydrogen powered pickup truck known as the Badger using Nikola’s parts and technology when he knew that was not true, the indictment claimed.

“Among the retail investors who ultimately invested in Nikola were investors who had no prior experience in the stock market and had begun trading during the COVID-19 pandemic to replace or supplement lost income or to occupy their time while in lockdown,” prosecutors wrote.

When it emerged that Milton’s statements were false and misleading, the value of Nikola’s stock plummeted.

“As a result, some of the retail investors that Milton’s fraudulent scheme targeted suffered tens and even hundreds of thousands of dollars in losses, including, in certain cases, the loss of their retirement savings or funds that they had borrowed to invest in Nikola,” the indictment added.
 

Copyright © 2021, ABC Audio. All rights reserved.

NBA Social Justice Coalition backs EQUAL Act, urges Congress to move quickly

iStock/Augustas Cetkauskas

(WASHINGTON) — The National Basketball Social Justice Coalition is fighting to end racial and social inequality.

The group, which is composed of players, owners and staffers, has advocated for policy changes regarding criminal justice, policing and justice reform, by reaching out to lawmakers in Congress and state and local legislatures.

The Social Justice Coalition was formed in 2020, after the deaths of Jacob Blake and George Floyd.

In May 2021, the group, which represents the NBA community, publicly endorsed the George Floyd Justice In Policing Act. Since then, a source told ABC News, members of the NBA have held multiple bipartisan meetings with lawmakers to push the bill.

The 15-member group exclusively told ABC News they are now publicly supporting the Eliminating a Quantifiably Unjust Application of the Law Act, or EQUAL Act, a bill that seeks to eliminate the federal differences in sentencing between crack and powder cocaine.

In a joint statement shared with ABC News, the NBA Social Justice Coalition wrote, “The EQUAL Act is a significant step towards more humane sentencing policies. On behalf of the NBA community, we urge our legislators to continue moving this bill towards passage as quickly as possible and present it to President Biden for signature into law this summer.”

James Cadogan, the coalition’s executive director, told ABC News the EQUAL Act “gives people currently incarcerated for federal crack offenses a mechanism for re-sentencing.”

“For 35 years, this legal disparity, with no basis in pharmacology, has only served to incarcerate unjustly,” Cadogan said. “And Black and brown communities across the country disproportionately continue to bear the human cost.”

Cadogan noted that the vast majority of people who’ve borne the brunt of that sentencing disparity are Black, because more Black people are incarcerated over crack cases than white people over powder cocaine cases.

“The proportions are different, but they were using the same substance and committing the same offense, so to have a sentencing disparity is something that should offend anybody in social justice,” Cadogan said. “And to see now a bill that will rectify that, that is a big step for racial justice, knowing how many Black and brown families have suffered because of that disparate sentencing.”

This isn’t the first time the NBA has taken action on social justice issues; greats like Kareem Abdul Jabbar and Oscar Robertson have famously fought for civil rights and economic justice.

“Social justice is part of the fabric of the NBA, but we haven’t had for the NBA community an institutionalized way of advancing that in the policy space,” Cadogan told ABC News.

Earlier this summer, Karl Anthony Towns, from the Minneapolis Timberwolves, Steve Ballmer, the chair of the Los Angeles Clippers, and Caron Butler, assistant coach of the Miami Heat, held a virtual roundtable with Sen. Tim Scott and congresswoman Karen Bass on the topic of policing reform. The conversation was streamed online with the hope of generating more dialog around the issue.

Bass and Scott have been in negotiations for months to craft a bipartisan police reform bill called the George Floyd Justice In Policing Act.

Cadogan told ABC News that by having athletes join forces with members of Congress, a new population of listeners, who may have not been fully engaged in politics previously, joined the conversation about the pending legislation. For viewers, it wasn’t “just about what’s wrong” with the bill, Cadogan said, “but how we fix it.”

“That’s part of what’s most important about our model and our advocacy approaches: We’re not just talking about the things that we see that we want to fix, we’re trying to put our really distinct platform behind the solutions in a legislative and policy framework that will make sense for us in our community that will help sustain change,” Cadogan said. “Things don’t change unless laws, policies change.”

Next on the agenda for the National Basketball Social Justice Coalition is the issue of voting rights. Last year, the NBA opened up 23 league facilities to help increase voting participation by using them as both polling locations and voter registration locations. Now, it is focusing on local legislatures.

“If people can’t vote, then people don’t have a voice in our democracy, and that’s unacceptable,” Cadogan said.

He said the NBA community is committed to helping bring about some of the changes that Americans have been demanding for so long. “There’s a lot on the horizon and we’re going to be pretty active,” he added. “Stay tuned.”

Copyright © 2021, ABC Audio. All rights reserved.