Trump Media & Technology Group

American media and technology company

  • Media
  • Technology
  • Social media
FoundedFebruary 2021; 3 years ago (2021-02)FoundersDonald TrumpHeadquartersPalm Beach, Florida, US
Key people
Donald Trump (Chairman)[1]
Devin Nunes (CEO)Products
  • Truth Social
  • TMTG+
  • TMTG News
Websitewww.tmtgcorp.com

Trump Media & Technology Group (TMTG), also known by its wholly owned subsidiary T Media Tech LLC,[2] is an American media and technology company founded in 2021 by former U.S. president Donald Trump.[3][1] In October 2021, the company announced a proposed merger agreement with Digital World Acquisition Corp (DWAC), a publicly traded special-purpose acquisition company.

Trump owned about 90% of the company in April 2023. Since January 2022, former U.S. representative Devin Nunes has served as the company's chief executive officer. In February 2022, TMTG launched the social network Truth Social. Trump reported in an April 2023 personal financial disclosure that he had made less than $201 from TMTG.[4]

A November 2023 DWAC financial disclosure indicated TMTG had generated losses such that management had "substantial doubt" about its ability to pay its bills, and the company's accounting firm had "substantial doubt" about the company's ability to remain in business.[5][6][7]

Operations

Incorporated in February 2021,[3] Trump Media & Technology Group intended to use a special-purpose acquisition company (SPAC) to facilitate its becoming a publicly traded company. On October 20, 2021, TMTG and Digital World Acquisition Corp. (DWAC), a publicly traded SPAC founded in September 2021 by Miami-based, former Deutsche Bank and Wall Street banker Patrick Orlando, announced that they had entered into a merger agreement that would combine the two entities, allowing TMTG to become a publicly traded company.[8] DWAC was created with the help of ARC Capital, a Shanghai-based firm specializing in listing Chinese companies on American stock markets that had been a target of SEC investigations for misrepresenting shell corporations.[9][10][11] In 2021, the DWAC Trump venture was linked with another company, China Yunhong Holdings based in Wuhan, Hubei,[12][13] until its lead banker who was running the merger promised to sever ties with China in December 2021, stating Yunhong was to "dissolve and liquidate".[14][15] In February 2022, Reuters reported that the connection between Shanghai-based ARC Capital and Digital World was more extensive than thought, with ARC having offered money to get the SPAC off the ground.[15]

The company's announced future product offerings include a social network (Truth Social) and on-demand programming (TMTG+).[16]

In December 2021, TMTG said it had raised $1 billion in private investment in public equity (PIPE) funding. The investors are unidentified. The Financial Times reported the expected proceeds of the PIPE and SPAC funding to TMTG would be $1.25 billion.[17]

On December 14, 2021, TMTG announced that it had entered into a "wide-ranging technology and cloud services agreement" with video platform Rumble, and that Rumble would operate part of the Truth Social network as well as TMTG+.[18][19]

On January 1, 2022, Devin Nunes (R-CA) resigned his seat from the U.S. House of Representatives to become the company's chief executive officer.[20][21]

A November 2023 DWAC financial disclosure showed TMTG's accounting firm raised "substantial doubt as to its ability to continue as a going concern" and company management "has substantial doubt that TMTG will have sufficient funds to meet its liabilities as they fall due." The disclosure showed that since the company's inception through June 2023 TMTG had lost $31.5 million.[6]

On November 21, 2023, Trump Media & Technology Group, filed a lawsuit seeking $1.5 billion in damages from 20 media outlets. The lawsuit alleges that the outlets falsely reported that Truth Social had incurred a $73 million loss and that the simultaneous reporting of the incorrect figure by all 20 outlets indicates a "coordinated effort" against Truth Social.[22][23] Several outlets issued corrections, saying that the error arose from a misinterpretion of the regulatory filing,[22][23] which reported a net loss of almost $23 million in the first six months of 2023.[23] On November 22, Reuters corrected its November 13 article and said that TMTG had reported a loss of $31.6 million from its 2022 launch until mid-2023.[24]

On March 22, 2024, DWAC shareholders approved a deal to merge with TMTG.[25] The company will trade under the symbol DJT.[26]

Truth Social

On February 21, 2022, TMTG released Truth Social, a competitor to platforms such as Twitter, on iOS. Truth Social faced staffing issues due to its political associations, and in early April 2022, Reuters reported that the company's head of technology and head of product development had resigned their posts following the network's "troubled" launch.[27]

After Elon Musk disclosed his large stake in and intent to buy out Twitter in April 2022, holding company DWAC lost 44% of its stock value. Matthew Kennedy, a market strategist at Renaissance Capital, said that the buyout was troubling for Digital World as a Musk-owned Twitter would undercut the rationale behind Truth Social's existence.[28]

On April 22, 2022, Rumble announced that Truth Social had successfully migrated its website and mobile applications to Rumble's cloud infrastructure.[1]

Legal issues

Trump's role

The Sarasota Herald-Tribune reported in July 2022 that according to Florida state records, Trump left as chairman of TMTG less than a month before the company received subpoenas from the SEC and the New York grand jury, concurrent with the DWAC subpoenas. His son Donald Trump Jr. and former Trump administration official Kash Patel were among others who simultaneously left the TMTG board of directors. Truth Social denied the report. Axios later published records filed by TMTG's agent with the Florida Division of Corporations; an April 28 filing showed Trump and others listed as "director," while a June 8 filing to change "person, title or capacity" directed the Division to "remove" Trump and others.[29][30][31]

Investigation of alleged Russian financial connections and alleged money laundering

The Guardian reported in March 2023 that in 2022 the SDNY expanded its criminal investigation to include whether TMTG engaged in money laundering. Beginning in December 2021, when the company was in danger of collapsing because its merger with DWAC had been delayed, it received a loan in two payments totaling $8 million. This included $2 million from Paxum Bank, which is part-owned by Anton Postolnikov, a relation of Aleksandr Smirnov, a former Russian government official who now runs the Russian maritime company Rosmorport. Another $6 million was paid by an ostensibly separate entity, ES Family Trust, which shared a director with Paxum Bank.[32][33][34][35] The $8 million loan was structured to automatically convert into TMTG common equity upon merging with the SPAC—meaning ES Family Trust will gain a stake in TMTG if the merger proceeds—though this was not disclosed to the SPAC investors nor the SEC.[36]

The federal probe into investors of DWAC, according to The Washington Post, discovered that a wealthy investor in the company was allegedly connected to attempts to allegedly move assets from Russia, Ukraine, and China into the Caribbean, and other intermediaries such as Hong Kong, United Kingdom and Belize. According to a government transcript, an informant referenced the process as "the full Singapore with a double dip, as we call it, with having the U.K. thrown in there, just to give it that added cleanliness and polishing off".[35]

Investigation of alleged insider trading

In June 2023, U.S. prosecutors charged three Florida men for alleged insider trading allegedly related to DWAC (Digital World Acquisition Corp) as part of Trump's social media merger deal in 2021.[37]

2024 lawsuits

In February 2024, United Atlantic Ventures (UAV), the partnership of TMTG co-founders Andy Litinsky and Wes Moss, sued TMTG for attempting to dilute their ownership stake by increasing the authorized stock from 120 million to 1 billion shares, thus lowering the value of UAV's shares from 8.6 percent to less than 1 percent.[38] Also in February, DWAC and Trump sued DWAC's former chief executive Patrick Orlando and his firm Arc Global Investments II for extortion and causing DWAC and Trump reputational harm. Orlando and Arc counter-sued DWAC and Trump for miscalculating Arc's stake in TMTG by 2 million shares.[38]

References

  1. ^ a b c "Exhibit 99". Archives. Securities and Exchange Commission. October 20, 2021. Archived from the original on October 22, 2021. Retrieved October 22, 2021.
  2. ^ "T Media Tech LLC". Apple Store. Retrieved October 31, 2021.
  3. ^ a b "TRUMP MEDIA GROUP CORP. :: Delaware (US)". opencorporates.com. Retrieved April 26, 2022.
  4. ^ Price, Michelle L. (April 14, 2023). "Trump reports little income from Truth Social, $1M from NFTs". Associated Press. Retrieved March 8, 2024.
  5. ^ Ponnezhath, Maria (November 14, 2023). "Trump's Truth Social reports $73 mln net loss since launch". Reuters. Archived from the original on November 14, 2023. Retrieved November 14, 2023.
  6. ^ a b Weprin, Alex (November 13, 2023). "Trump's Truth Social Lost Tens of Millions Since Launch, New Filing Shows". The Hollywood Reporter. Retrieved November 14, 2023.
  7. ^ "Amendment No. 1 to Form S-4 Registration Statement Under the Securities Act of 1933". www.sec.gov. November 13, 2023. Archived from the original on November 14, 2023. Retrieved November 14, 2023.
  8. ^ Enrich, David; Goldstein, Matthew; Goldmacher, Shane (October 30, 2021). "Trump Takes Advantage of Wall Street Fad to Bankroll New Venture". The New York Times. Retrieved March 2, 2024.
  9. ^ "Trump announces launch of media company, social media site". AP News. October 21, 2021. Archived from the original on October 21, 2021. Retrieved October 31, 2021.
  10. ^ Goldstein, Matthew; Hirsch, Lauren; Enrich, David (October 29, 2021). "Trump's $300 Million SPAC Deal May Have Skirted Securities Laws". The New York Times. Retrieved October 31, 2021.
  11. ^ Douglas MacMillan; Jonathan O'Connell (December 23, 2021). "Trump's newest business partner: A Chinese firm with a history of SEC investigations". The Washington Post.
  12. ^ Feng, John (October 22, 2021). "How Donald Trump's Truth Social is connected to China". Newsweek. Retrieved August 3, 2022.
  13. ^ "Trump's new social media backer tied to China lifestyle venture". www.aljazeera.com. Retrieved August 3, 2022.
  14. ^ Feng, John (December 8, 2021). "Patrick Orlando, bankroller of Donald Trump's Truth Social, Severs China Connections". Newsweek. Retrieved August 14, 2022.
  15. ^ a b Wang, Echo; Berens, Michael (February 10, 2022). "How a Trump deal got a boost from a China-based financier". Reuters. Retrieved August 14, 2022. The initial investors in the management entity, or sponsor, of Digital World put in a total of $11.8 million, disclosures show. / The Washington Post and Bloomberg News previously reported that ARC has a stake in the sponsor of Digital World. The fact that ARC offered money to get the SPAC off the ground is reported here for the first time.
  16. ^ "Company Overview". www.tmtgcorp.com. Archived from the original on October 21, 2021. Retrieved October 21, 2021.
  17. ^ Asgari, Nikou; Indap, Sujeet (December 4, 2021). "Donald Trump's social media start-up raises $1bn". Financial Times. Retrieved December 4, 2021.
  18. ^ Baxter, Brian (December 9, 2021). "Former Trump, Nunes Aide Lands Top Legal Job at Rumble Platform". Bloomberg Law. Retrieved March 8, 2024.
  19. ^ Schnell, Mychael (December 14, 2021). "Trump media company inks deal with video platform Rumble". The Hill. Retrieved December 14, 2021.
  20. ^ Nobles, Ryan (December 6, 2021). "Devin Nunes says he's leaving Congress by the end of the year". CNN. Retrieved March 8, 2024.
  21. ^ "Current Vacancies of the 117th Congress". Clerk, United States House of Representatives. Retrieved January 3, 2022. Resigned January 01, 2022 / Rep. Devin Nunes
  22. ^ a b Burnson, Robert (November 20, 2023). "Trump's Truth Social Parent Company Sues 20 Media Outlets". BNN Bloomberg. Retrieved March 1, 2024.
  23. ^ a b c Spirlet, Thibault (November 21, 2023). "Donald Trump's media company is suing 20 publications, alleging they falsely reported that Truth Social lost $73 million". Business Insider. Retrieved March 1, 2024.
  24. ^ Ponnezhath, Maria (November 22, 2023). "Trump's Truth Social reports $31.6 mln net loss since launch to mid-2023". Reuters. Retrieved March 1, 2024.
  25. ^ "Trump's Social Media Company Will Go Public After Merger With Shell Company Is Approved". HuffPost. March 22, 2024. Retrieved March 22, 2024.
  26. ^ Wyatte Grantham-Philips (March 22, 2024). "Trump's social media company approved to go public, potentially netting former president billions". Associated Press. Retrieved March 23, 2024.
  27. ^ "Two key tech execs quit Trump's Truth Social after troubled app launch". Reuters. April 4, 2022. Retrieved April 4, 2022 – via CNBC.
  28. ^ Egan, Matt (April 25, 2022). "Trump SPAC is down 44% since Elon Musk disclosed Twitter stake". CNN. Retrieved April 26, 2022.
  29. ^ Chris Andersen (July 7, 2022). "Exclusive: Trump left Sarasota media company weeks before federal subpoenas were issued". Sarasota Herald-Tribune. Retrieved March 8, 2024.
  30. ^ Whitten, Sarah (July 7, 2022). "Donald Trump left the board of his social media company weeks before federal subpoenas, filing shows". CNBC. Retrieved March 8, 2024.
  31. ^ Primack, Dan; Fischer, Sara (July 7, 2022). "Trump's social media company disputes he left its board". Axios. Retrieved March 8, 2024.
  32. ^ Lowell, Hugo (March 15, 2023). "Federal investigators examined Trump Media for possible money laundering, sources say". The Guardian. ISSN 0261-3077. Retrieved March 15, 2023.
  33. ^ Durkee, Alison (March 15, 2023). "Trump's Media Company Reportedly Under Federal Investigation For Money Laundering Linked To Russia". Forbes. Retrieved March 15, 2023.
  34. ^ Wieder, Ben; Weaver, Jay (January 24, 2024). "Russian investor made millions off insider trading tied to Trump Media, court docs say". Miami Herald.
  35. ^ a b Harwell, Drew (February 5, 2024). "The wild probe into investors of DWAC, Trump Media's proposed merger ally". Washington Post. ISSN 0190-8286. Retrieved March 22, 2024. But he also extended to the informant his own connections, saying he had a Russian friend who lived on Fisher Island and owned a bank in Dominica that could provide banking services to Russian, Chinese or Ukrainian individuals facing "sanction issues" or other financial restrictions, the government's transcript shows.
  36. ^ Harwell, Drew; Bernardini, Matt; Rosca, Matei (May 13, 2023). "Trust linked to porn-friendly bank could gain a stake in Trump's Truth Social". The Washington Post. Retrieved March 8, 2024.
  37. ^ Stempel, Jonathan; Coster, Helen (June 29, 2023). "Three charged with insider trading ahead of proposed Trump Media merger". Reuters.
  38. ^ a b Harwell, Drew (February 29, 2024). "Trump Media co-founders sue company, alleging a scheme to dilute shares". The Washington Post. Retrieved March 1, 2024.

External links

  • Official website Edit this at Wikidata
  • Digital World Acquisition Corp. website
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