Donald Trump’s Social Media Firm Said to Receive Subpoenas From SEC, Federal Jury

Donald Trump, who is Trump Media's chairman, was not among the employees who received subpoenas, according to an official statement.

Donald Trump’s Social Media Firm Said to Receive Subpoenas From SEC, Federal Jury

Digital World has been under investigation by the SEC for possible violations for months

Highlights
  • Digital World has plans to buy Trump Media
  • The investigation by SEC weighed on the Digital World stock
  • Truth Social was launched in February

Donald Trump's social media company and some of its employees received subpoenas from both a federal grand jury and securities regulators, according to a public disclosure Friday, possibly delaying or even killing a deal promising a cash infusion needed to take on Twitter.

Trump Media & Technology Group received subpoenas from a grand jury in New York and the Securities and Exchange Commission, according to a securities document filed by Digital World Acquisition on Friday. Digital World has plans to buy Trump Media, releasing $1.3 billion (roughly Rs. 10,263 crore) for its fledging business, but the deal is unlikely to be done during two legal probes.

Trump, who is Trump Media's chairman, was not among the employees who received subpoenas, according to a Trump Media statement.

On Monday, Digital World announced it had received subpoenas from the same grand jury convened by the Manhattan US Attorney's Office. Digital World has been under investigation by the SEC for possible violations for months, a development that has weighed on the stock.

Digital World stock closed Friday at $5.78 (roughly Rs. 450), down 25 percent in a week. It had been at over $100 (roughly Rs. 7,800) last year after the company announced it had a deal to buy the former president's social media firm.

The SEC has been looking into whether Digital World broke rules by having substantial talks about buying Trump's company starting early last year before Digital World sold stock to the public for the first time in September. Just weeks later it announced it would be buying Trump's company.

Digital World is one of a once-popular group of “blank-check” companies that go public as empty corporate entities with no operations, only offering investors the promise they will buy a business in the future. As such, they are allowed to sell stock to the public quickly without the usual regulatory disclosures and delays, but only if they haven't already lined up possible acquisition targets.

Trump's social media offering, called Truth Social, launched in February. It said it is fighting Big Tech limits on speech. Trump was banned from Twitter, Facebook and YouTube last year after the January 6 Capitol riot.

Trump Media last year lined up dozens of investors to pump $1 billion (roughly Rs. 7,895 crore) into the company, but can't get the cash until the Digital World acquisition is completed. An additional $300 million (roughly Rs. 2,368 crore) would come from Digital World itself.


How is Alexa faring in India? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
Affiliate links may be automatically generated - see our ethics statement for details.
Comments

For the latest tech news and reviews, follow Gadgets 360 on Twitter, Facebook, and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel.

Hyderabad Plans to Set Up 330 EV Charging Centres Based on Feasibility of Locations
Google Says to Delete Users’ Location History for Abortion Clinics, Domestic Violence Centres
Share on Facebook Tweet Snapchat Share Reddit Comment google-newsGoogle News
 
 

Advertisement

Follow Us

Advertisement

© Copyright Red Pixels Ventures Limited 2022. All rights reserved.