While Digital World Has Gotten a Tentative All-Clear Signal From the SEC Trump Appears To Be Angling To Return to Twitter

Digital World Acquisition Corp. (NASDAQ:DWAC), the Special Purpose Acquisition Company (SPAC) that is slated to take Truth Social’s parent, Trump Media and Technology Group (TMTG), public in a much-anticipated reverse merger deal, has finally received a tentative all-clear signal from the SEC, paving the way for the much-delayed deal to finally achieve closure.

Digital World noted in a recent Form 8-K filed with the SEC:

“In connection with the Investigation, DWAC has reached an agreement in principle with the Staff of the SEC’s Division of Enforcement (the “Settlement in Principle”). The terms of this Settlement in Principle are not yet definitive, as a final settlement agreement is subject to the approval by the Commission, and the Company cannot predict whether or when it may obtain the Commission’s approval.”

Under the preliminary terms, Digital World will pay a civil penalty of $18 million to the SEC immediately after closing its merger agreement with Trump Media and Technology Group. The SPAC is also required to amend its previously-filed Form S-4 to rectify any lacunae related to the accuracy of the presented information.

As a refresher, the SEC and FINRA have been investigating Digital World in connection with alleged violations of securities law and inappropriate disclosure of pertinent information in the run-up to the merger announcement. Specifically, the SPAC’s management is believed to have held private discussions about a merger with TMTG as early as May 2021 but failed to disclose this pertinent information in its public filings.

Additionally, Trump Media and Technology Group itself is being investigated by federal prosecutors in New York for allegedly violating statutes related to money laundering. The federal authorities are examining loans worth $8 million that were routed through the Caribbean but originated from obscure entities connected with Russian President Vladimir Putin. Of course, Trump himself continues to face a myriad of indictments related to Stormy Daniels and violations of campaign finance laws.

Is Trump Having Cold Feet Vis-à-vis Truth Social?

I know that Trump is contractually obligated to post only on Truth Social, and on other media only after a delay. Is the cold feet about wanting to return to Twitter for his presidential campaign?

— @annmlipton@esq.social (@AnnMLipton) July 3, 2023

As detailed in the tweet above, Trump is contractually obligated to post first on his Twitter-like echo chamber, Truth Social. However, law professor Ann Lipton now believes that Trump might be having second thoughts about his commitment to Truth Social.

Professor Lipton cited an email quoted by the New York Times, which mentioned that the Trump Media and Technology Group was “currently only bound under the merger agreement [with Digital World] through Sept. 8, 2023.”

According to the professor, this suggests that Trump might be having “cold feet” vis-à-vis his commitment to Truth Social and that he appears to be angling to return to Twitter as his presidential campaign gains steam.

Written by Rohail Saleem