(Bloomberg) -- Donald Trump’s bid to recapture his social media presence is facing scrutiny from Senator Elizabeth Warren over reports that the blank-check company merger the former president used to raise millions of dollars may have skirted securities rules.
Warren, a constant adversary of Trump’s when he occupied the White House, wants the Securities and Exchange Commission to investigate whether October’s merger between Trump Media and Technology Group and Digital World Acquisition Corp. was in the works long before the special purpose acquisition company sold shares.
The Massachusetts Democrat said she’s concerned that Digital World’s chief executive officer may have held talks with Trump months ago -- discussions that weren’t disclosed to potential investors.
“DWAC’s failure to disclose these talks during the process appears to be an omission of material information necessary for both early institutional investors and retail investors in the SPAC’s public offering,” she said in a Wednesday letter to SEC Chair Gary Gensler.
Warren cited a New York Times report that Digital World had communicated with Trump’s firm as early as March, while stating in securities filings that the SPAC had no specific acquisition target in mind. SPACs like Digital World aren’t supposed to pursue deals until after they go public. The alleged omission enriched Digital World’s sponsors and Trump Media, while “trapping retail investors in a stock bubble,” Warren said in an accompanying statement.
An SEC spokesperson declined to comment. Spokespeople for Trump Media and Digital World didn’t immediately respond to requests for comment.