According to a public declaration made on Friday, a federal grand jury and securities regulators issued subpoenas to Donald Trump’s social media company and several of its workers. This might delay or even scupper a deal that promised the cash infusion needed to compete with Twitter.
According to a securities filing submitted by Digital World Acquisition Corp. on Friday, the Securities and Exchange Commission and a grand jury in New York have issued subpoenas to Trump Media & Technology Group. Trump Media has ambitions to be acquired by Digital World, freeing up $1.3 billion for its fledgling company, but the deal is unlikely to be completed while two judicial investigations are ongoing.
Trump, who serves as the chairman of Trump Media, was not one of the staff members who got subpoenas, per a statement from Trump Media.
The SEC is investigating whether Digital World violated any regulations by holding serious discussions about acquiring Trump’s business beginning in early last year, prior to Digital World’s initial public offering of stock in September. A few weeks later, it made the announcement that it would acquire Trump’s business.
Digital World is a member of a formerly well-liked class of “blank-check” firms, which go public as empty corporate entities with no operations and merely promise investors that they will eventually buy a business. So long as they haven’t previously identified potential acquisition targets, they are permitted to immediately offer stock to the public without the regular regulatory disclosures and procedures.
Truth Social, Trump’s social media platform, debuted in February. It claimed to be against speech restrictions imposed by Big Tech. After the Capitol incident on January 6, Trump was expelled from Twitter, Facebook, and YouTube last year.
Trump Media secured hundreds of investors last year who planned to invest $1 billion in the business, but the money won’t be available until the Digital World deal is finalized. Digital World alone would provide an additional $300 million.