Part of the story is how passive index ETFs work. https://www.etf.com/stock/NKLA sort by # shares owned, you'll see the biggest owners of NKLA stock are ishares funds, vanguard etc. These funds buy based on market cap of the stock.
Anyone with a retirement account that holds passive etfs (or things like target date retirement funds) is a stockholder in NKLA, a stock which no active fund manager would touch with a 10foot pole.
As passive accounts for more than half of the total market funds/flows, blatant frauds that somehow manage to be included in these funds have an easier time surviving (and the larger the market cap, the more inflows their shares receive).
In the 2021 stock mania there were other factors at play too.
As passive accounts for more than half of the total market funds/flows, blatant frauds that somehow manage to be included in these funds have an easier time surviving (and the larger the market cap, the more inflows their shares receive). In the 2021 stock mania there were other factors at play too.