Trust linked to porn-friendly bank could gain a stake in Trump's Truth Social
SPACs are somewhat sketchy which is why the SEC has a ton of rules with respect to SPACs. SPACs took the place of some very very sketchy deals with shell public companies (public companies with more than 300 to 500 shareholders but no assets) would merge into a private company to take that company public without a full registration statement. SPACs have rules to mitigate against the abuses of public shell deals. Who is surprised that TFG would ignored these rules and commit outright fraud. The SEC has blocked the merger of Trump Media & Technology (TFG's entity) with Digitial Acquistion Corp (the SPAC). There is so much fraud here that this story does not surprise me. Both the SEC and the DOJ are involved in this case.
If this deal had been consummated as plan, TFG would be in control of a company with $1.3 billion in assets and could cause a ton of havoc building up a media organization that would has less ethics than Fox News. As noted in this article, SPACs are normally straight forward deals. I heard from a biglaw attorney who have worked on SPACs that these deals tend to be loss leaders for biglaw firms because they are normally very cookie cutter.
I am using a link that allows anyone to read all of the Washington Post article. There is more good stuff in that article than one can post on DU
Link to tweet
https://www.washingtonpost.com/technology/2023/05/13/trump-truth-social-loan-questions/?pwapi_token=eyJ0eXAiOiJKV1QiLCJhbGciOiJIUzI1NiJ9.eyJzdWJpZCI6IjUyOTMyMzQ3IiwicmVhc29uIjoiZ2lmdCIsIm5iZiI6MTY4NDAzNjgwMCwiaXNzIjoic3Vic2NyaXB0aW9ucyIsImV4cCI6MTY4NTMzMjc5OSwiaWF0IjoxNjg0MDM2ODAwLCJqdGkiOiIzMmRkNjc0NS0yNGI2LTQwNzEtOGVmNC0xMWJhYWJjZjEyMDAiLCJ1cmwiOiJodHRwczovL3d3dy53YXNoaW5ndG9ucG9zdC5jb20vdGVjaG5vbG9neS8yMDIzLzA1LzEzL3RydW1wLXRydXRoLXNvY2lhbC1sb2FuLXF1ZXN0aW9ucy8ifQ.kTcQvJpqrdTU5v_3CzVq5MxgkHmQUllZV-aztOgDXbY
Yet the role ES Family Trust would assume in Trump Media and Technology Group has never been officially disclosed to the Securities and Exchange Commission or to shareholders in Digital World Acquisition, the special purpose acquisition company, or SPAC, that has proposed merging with Trump’s company.
The companies also have not disclosed to shareholders or the SEC that Trump Media paid a $240,000 finder’s fee for helping to arrange the $8 million loan deal with ES Family Trust — or that the recipient of that fee was an outside brokerage associated with Patrick Orlando, then Digital World’s CEO.......
Company-SPAC mergers are traditionally quick and straightforward affairs, according to a 2020 presentation by lawyers at the firm Morgan Lewis. A SPAC submits a merger registration document called an S-4; the SEC reviews it and asks further questions, often within 30 days; the company sends in answers in an amended filing, the SEC responds within 14 days, and the whole process generally wraps up within a matter of months.
Digital World’s S-4, however, has been in limbo since May 16, 2022, SEC records show. The most recent correspondence from the SEC to Digital World, in August, was a terse boilerplate letter in which an agency official said, “We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures,” public SEC records show.
This deal is not likely to be approved by the SEC anytime in the near future. The DOJ is involved in this matter in addition to the SEC and so there may be some criminal prosecutions.
Again, the Washington Post story is only the latest story in the troubled history of this deal
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