August 15, 2022

Trump’s true social contract is subject to Grand Jury scrutiny

Former President Donald J. The public list of Trump’s social media company was released on Monday. Revealed in a regulatory document A federal grand jury in New York recently awarded saponas to the company and its directors.

The grand jury sapons were awarded last week, according to a lawsuit filed by Digital World Acquisition Corporation, or SPAC, the special purpose acquisition company that announced Trump’s merger with Media & Technology Group in October. Following the merger, Trump will adopt Media Digital World’s list and trade as a public company.

The revelation of the Digital World is the first indication that federal lawyers in Manhattan have joined in the study of the link between the Digital World and Trump Media, which has been under investigation by financial regulators for months. Mr. The investigation threatens to further delay the merger of Trump’s company and its social media site Truth Social with up to $ 1.3 billion in capital along with the stock market list.

Securities and Exchange Commission and the Financial Industry Regulatory Commission Opened inquiries Within weeks of the announcement of the merger. The Digital World filed on Monday, with the Grand Jury chaplains requesting information similar to what the SEC had already requested.

The Federal Grand Jury requested “information on Rocket One Capital”. The filing did not disclose what information the Grand Jury needed about Rocket One, the venture capital firm in Miami.

A Separate filing, Bruce Karelik resigns as director of Digital World As Chief Strategic Officer on Rocket One, Mr. Karelik is listed in the Digital World Files.

For a request for comment, Mr. Karelik did not respond immediately. The petition did not state the reason for his resignation.

The SEC investigation The SPAC has focused on whether there were serious discussions between the Digital World and Trump’s media leadership before it went public last September. Those talks were not released In regulatory filings. SPACs, which raise money to go public in the hope of finding a merger candidate, should not keep the acquisition goal in mind when raising money from investors.

Regulators also demanded information about unusual business practices in Digital World’s securities prior to the merger announcement. There There was a huge boom in trade Digital World Warrants – The security provided to the holder of the right to purchase shares prior to the announcement of the merger.

Trump Media released a statement in response to the Digital World revelation that it “focuses on restoring the free expression of the American people.” The company added, “We encourage and support oversight of the SEC’s important mission of protecting retail investors.”

Grand jury saponas are usually awarded in connection with a potential criminal investigation. Damien Williams, a spokesman for the U.S. Attorney’s in Manhattan, declined to comment on the Grand Jury’s offer to Digital World.

Social media clones like Trump Media’s Truth Social, Twitter, Mr. Start slowly, Especially among conservatives and other supporters of the former president has begun to gather supporters. Mr. Trump was Banned from Twitter In January 2021, after repeated reports that the 2020 presidential election had been rigged and that the January 6 attack on the Capitol building had not been quickly condemned.

Elon Musk, billionaire businessman Who provided the opportunity to purchase Twitter, Has said he will allow Mr Trump to return to the largest social media site if he concludes his contract. Mr Trump has said he has no intention of returning to Twitter.

But the license agreement between Trump and the former president allows him to post a message Political nature On Twitter or other social media sites.

In regulatory filings, Digital World Truth Social claims to “provide a truly free talk site to its users and avoid cancellation by Big Tech”.

The head of Trump Media, Mr. Devin Nunes, a former Republican congressman from California, is the CEO of Trump Media, which recently moved its corporate office to Naples, Fla.

No one associated with the Trump media seems to have received any sapona, according to the Digital World filings.

It is unknown at this time what he will do after leaving the post. The venture capital firm is headed by Michael Schwartzman, who did not provide requests for comment. Shortly after the Digital World Grand Jury unveiled Sapona, Rocket One removed most of it. Public Website.

The parallel investigation by federal prosecutors and security regulators comes as the deadline to complete the merger expires on September 8th. The proposed merger agreement allows the deadline for the contract to be extended to March 8, 2023.

But partners SPACs are increasingly reluctant As the share prices of many SPACs have increased in recent months, the deadline for concluding mergers should be extended.

Shares of Digital World, which closed at $ 27.82 last week, fell more than 10 percent in early trading on Monday. The stock has fallen more than 70 percent since its March high, but remains above its $ 10 listed price.

If the merger is not completed, Digital World will have to repay the nearly $ 300 million raised in the IPO to shareholders. Dozens of hedge funds will cancel the $ 1 billion they promised to invest in the completed contract.

The poor performance of the SPACs led to the cancellation of several planned mergers by agreement of the parties. The proposed agreement between Trump Media and Digital World allows both parties to mutually agree to terminate the agreement.

Earlier this year, Trump Media raised about $ 15 million from a group of unnamed investors. Kitty Bennett contributed to the research.