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Trump media company gets subpoena in federal criminal probe of SPAC deal

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Former U.S. President Donald Trump gives the keynote address on the Faith & Freedom Coalition during their annual “Road To Majority Policy Conference” on the Gaylord Opryland Resort & Convention Center June 17, 2022 in Nashville, Tennessee.

Seth Herald | Getty Images

Donald Trump’s media company was subpoenaed by a federal grand jury in reference to a criminal probe, based on the corporate with which the previous president’s firm plans to merge.

Digital World Acquisition Corp. said in a filing Friday that Trump Media and Technology Group received a subpoena from the grand jury in Manhattan on Thursday. The Trump company also received a subpoena from the Securities and Exchange Commission regarding a civil probe on Monday, DWAC said.

DWAC also said some current and former TMTG employees have also recently received grand jury subpoenas.

The filing got here days after DWAC said the federal government investigations could delay and even prevent its merger with Trump’s newly formed company, which incorporates Truth Social, a social media app intended to be a substitute for Twitter.

Neither TMTG nor a spokeswoman for Trump immediately responded to CNBC’s requests for comment.

The Justice Department and the SEC, which regulates the stock market, are investigating the deal between DWAC and Trump Media. By merging with DWAC, which is a sort of shell company called a special purpose acquisition company, or SPAC, Trump’s firm would gain access to potentially billions of dollars on public equities markets.

Trump established Truth Social months after Twitter banned him for his tweets on Jan. 6, 2021, when tons of of his supporters stormed the U.S. Capitol in a bid to overturn Joe Biden’s victory within the presidential election. Trump Media’s CEO is former Rep. Devin Nunes, one in all the previous president’s most ardent loyalists within the Republican Party. Trump can be considering whether to run for president within the 2024 election.

Trump has continued to spread the lie that the election was stolen from him. His alleged involvement within the Jan. 6 rebellion is being probed by a House select committee that has accused the previous president of being at the middle of a multipronged conspiracy to dam the peaceful transfer of power to Biden.

Early criticism of the Trump-DWAC deal got here from Sen. Elizabeth Warren, D-Mass. In calling for an investigation, she wrote to SEC Chair Gary Gensler in November, telling him that DWAC “could have committed securities violations by holding private and undisclosed discussions in regards to the merger as early as May 2021, while omitting this information in [SEC] filing and other public statements.”

DWAC shares are far off their highs, closing Friday at $24.20. The stock had surged above $90 in October, after the cope with Trump’s group was announced.

DWAC on Monday revealed in a securities filing that it learned June 16 that every member of its board of directors received subpoenas from the identical federal grand jury.

The grand jury sought documents just like those the SEC already requested as a part of its civil probe, DWAC said. The corporate itself was served with a subpoena per week ago with similar requests, together with other requests referring to communications, individuals and knowledge involving Rocket One Capital.

DWAC also revealed Monday that a board member, Bruce J. Garelick, had told management that he would quit the board in the course of the previous week. Garelick said his resignation “was not the results of any disagreement with Digital World’s operations, policies or practices,” based on the corporate filing.

— CNBC’s Kevin Breuninger and Thomas Franck contributed to this story.

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