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The U.S. Securities and Exchange Commission has filed a lawsuit against Patrick Orlando, the former CEO of Digital World Acquisition Corp, the company that facilitated the public listing of Donald Trump‘s social media venture. The lawsuit, filed on Wednesday, alleges Orlando of committing securities fraud.
What Happened: The SEC has accused Orlando of violating securities regulations by issuing misleading and false statements during his tenure at the special purpose acquisition company, reported Reuters on Thursday.
The lawsuit claims that Orlando deceived investors by not disclosing the company’s plans to acquire Trump Media & Technology Group Corp (NASDAQ:DJT) before DWAC’s initial public offering.
Orlando’s company, Digital World, completed its merger with Trump Media & Technology Group in March. This company owns Truth Social, a social media platform endorsed by Trump.
The SEC had previously charged DWAC with making “material misrepresentations” to investors in July last year. The company agreed to a cease-and-desist order and an $18 million penalty if the merger was finalized.
Why It Matters: This lawsuit against Orlando comes amid a series of events surrounding Trump’s social media venture. In April, a board member of Trump Media was implicated in a hacking lawsuit, alleging a corporate coup aimed at removing Orlando, the original architect of the deal to take the social media company public.
Trump Media’s public debut was largely due to emergency loans received in 2022, preventing a potential failure to merge with Digital World Acquisition Corporation. A securities investigation into the merger in 2021 led to the rapid depletion of Trump Media’s cash reserves while awaiting its stock market debut.
Amid these legal and financial challenges, Trump’s net worth surged, pushing him into the list of the world’s 500 wealthiest individuals following the successful listing of Trump Media & Technology Group in March.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
