Trump’s SPAC Deal May Have Violated Securities Laws

Trump’s recent Venture into Special Purpose Acquisition Companies (SPAC), may have fallen Afoul of Securities Laws.

Trump announced Plans earlier this month, to take his Fledgling Social Media Venture, Trump Media & Technology Group, Public via a SPAC Merger with Digital World Acquisition.

The Publicly Traded Shell Company, which began Trading on the Nasdaq, in September, under the Ticker DWAC, subsequently saw its shares Soar on the strength of Robust Investor Interest, though the Stock has since Tapered-Off from its Highs.

But on Thursday, it was Reported that DWAC may have Skirted Securities Regulations, since its Founder, Florida-based Financier Patrick Orlando, had been in Discussions with Trump over the SPAC Merger for Months, in advance, of DWAC’s Public Market Debut in September.

People with Knowledge of the Talks between the Two men, who said that Trump and Orlando, who has launched No fewer than Three other SPACs on US Exchanges, had been Discussing a SPAC Merger as early as last March.

By Law, SPACs aren’t supposed to have such a Merger Planned at the time of their IPO, and are instead meant to Merge with a Private Company, only after they’ve begun Trading on a Stock Exchange.

Otherwise, it would be too Easy for Private Companies to use SPACs as “Backdoor Vehicles” to go Public without the Level of Public Disclosure and Scrutiny, they would usually be Exposed to through a Traditional Listing.

Since SPACs are meant to Function as Empty Shell Companies at the time of their IPO, such Public Disclosures are deemed Unnecessary.

Lawyers and Securities Industry Officials said that, the Discussions between Trump and Orlando, could draw Inquiries from the Securities and Exchange Commission (SEC), especially since DWAC’s Securities Filings repeatedly state that the Company had Not Engaged in any “substantive discussions, directly or indirectly,” with a Target Company.

The SPAC Merger is expected to raise Hundreds of Millions of Dollars for Trump’s New Social Media Venture.

Meanwhile, Orlando and other DWAC Backers are expected to see Hundreds of Millions more in Proceeds, as a Result of the Stock’s Performance.

The SPAC was as High at $94.20 per share, currently is valued at $67.75.

When the SPAC announced the Trump Media & Technology Group Deal, some of the Investors sold out their Shares.










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