Federal prosecutors and securities regulators are investigating a proposed merger between a cash-rich blank check company and a former president.
According to a regulatory filing on Friday, Digital World Acquisition, the special purpose acquisition company that has a tentative deal to merge with Trump Media, has been subpoenaed by the federal prosecutors.
Grand jury subpoenas are used for criminal investigations. The SEC served a subpoena on Trump Media, according to the filing.
Digital World said it had received a grand jury subpoena from federal prosecutors in Manhattan along with similar subpoenas served on its board of directors.
The grand jury subpoenas appear to be related to the Digital World subpoenas.
According to the regulatory filing, the grand jury subpoenas served on Trump Media were looking for a subset of the same or similar documents demanded in subpoenas to Digital World and its directors.
The merger would give Mr. Trump a company with up to $1 billion in capital and a stock market listing.
The S.E.C. investigation is looking into whether there were serious discussions between the leadership of Digital World and Trump Media before the special purpose acquisition company went public. When raising money from investors, SPACs are not supposed to have an acquisition target in mind.
Information about trading activity in Digital World's securities has been requested by regulators. Digital World warrants, a type of security that gives the holder the right to buy shares at a specified price, saw a surge in trading a few weeks before the merger announcement.
The representatives for Trump Media didn't respond to the request for comment.
The CEO of the company is a former Republican congressman. The company is chaired by Mr. Trump.
It's not clear which current and former employees received subpoenas.
The company's main product is Truth Social. Mr. Trump is a frequent poster on the platform.
He criticized the testimony of a former White House aide before a congressional committee.
The former president couldn't use Truth Social after the attack on the Capitol because Trump Media said it was a "free expression" alternative.
The reporting was contributed by the person who gave it.
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