It’s been an interesting couple of years for Trump, but now there’s a new episode in his saga of controversies. The ex-President hoped to launch Truth Social by merging his Trump Media and Technology Group with the Special Purpose Acquisition Company (SPAC) Digital World Acquisition Corporation. But now, US financial regulators are investigating the SPAC.
The launch of Trump Social
Trump was planning to launch his own social media platform for a while in response to the fact that most major social media companies have banned him and censored his supporters. He revealed his intentions for Truth Social on 20 October, hoping to launch it before the 2022 midterm elections.
The platform hoped to compete with mainstream social media platforms like Twitter and Facebook but with more of a political bent.
A key part of the plan was merging with a SPAC. Also known as “blank check” firms, SPACs are companies that become publicly listed without having an actual business. Instead, they wait for a more established entity to merge with them — this means the SPAC gains from the merger and the acquiring company doesn’t have to go through the risks and pressure of an IPO. It’s become an increasingly popular practice in recent years.
Trump Social appeared to be making some progress, with Republican congressman Devin Nunes resigning from politics to become the company’s CEO.
However, two different financial regulators are now investigating Digital World Acquisition Corporation. On 6 December, it was revealed that Securities of Exchange Commission (SEC) officials had asked for further information about the merger deal.
The Financial Industry Regulatory Authority, an independent regulator, has also started an investigation.
There are concerns that the company has kept documents and other information about the merger secret from authorities, which would be a violation of regulations. Companies are supposed to keep the SEC informed about deals and disclose certain information as they progress.
The future of Trump Social
It’s not all over for Trump Social yet — it might turn out that the company hasn’t violated any laws or done anything wrong. Therefore, it’s possible that the company could manage to launch next year and progress with its plans.
The investigation continues.