A comprehensive federal inquiry into the funding of Donald Trump’s entry into social media has expanded its reach, now including the FBI, the SEC, a branch of the Department of Homeland Security, and a top-tier anti-money-laundering squad, as per a recent federal disclosure.
No Allegations Yet
While no formal accusations have been made against Donald Trump or Trump Media in the probe surrounding the embattled Truth Social platform, federal agents are scrutinizing a partnership allegedly fraught with financial improprieties from the start, reports the Washington Post.
Key Figure Under Scrutiny
The investigation’s spotlight falls on Patrick Orlando, the CEO of Digital World, whose company special purpose acquisition company (SPAC) was instrumental in securing funds for the initiative in the absence of bank financing.
Discussions with Trump
Orlando had privately informed investors for several months that he had engaged in discussions with Trump regarding the deal, a breach of federal securities regulations as per the SEC.
Investor with Russian Ties
According to an FBI search warrant, one investor, Anton Postolnikov, a Miami Beach entrepreneur born in Russia and the nephew of a Russian government official, had acquired a substantial stake in Digital World.
$22 Million Profit
Shortly after Trump’s announcement, which significantly boosted the stock’s value, Postolnikov swiftly sold the majority of his holdings, yielding a profit of $22 million.
Nightclub Manager Turned Investor
Another individual, Michael Shvartsman, who transitioned from being a nightclub manager in Ukraine to a private equity investor, shared details of the lucrative opportunity with his business associates and a neighbor, as outlined in the affidavit. Subsequently, he managed to secure $18 million in profits for himself.
SEC Delays Deal
The heightened financial activity attracted the attention of investigators, causing the SEC to delay the deal and enlist the involvement of other government agencies.
$300M Hold on Truth Social
Consequently, the $300 million that Truth Social had anticipated to maintain its operations is currently on hold.
Post-Rejection Merger Plan
After facing rejection from banks and lenders due to his association with the January 6, 2021, insurrection and his extensive track record of bankruptcies and business failures, Trump authorized the merger of his company with a special purpose acquisition company as a means to secure funds in the months following his departure from the White House.
Persecution Claims
Trump supporters have asserted that the delay in the SEC’s approval of the merger serves as evidence of persecution by the Biden administration.
Extended Investigation
However, the collection of investigative documents, submitted as part of the pretrial discovery procedure in preparation for a trial in the upcoming spring involving those already facing charges, reveals that the investigation extended well beyond the jurisdiction of the SEC.
Ongoing Global Crime Probe
The documents provide a detailed account of the engagement of federal agents and investigators who are dedicated to uncovering international criminal operations, including one of the government’s top-tier anti-money-laundering units. These documents indicate that the investigation is still active and ongoing.
Undercover Efforts
An undercover informant equipped with a microphone captured Michael Shvartsman’s attempts to transfer his gains into offshore accounts, which he claimed were derived from events related to Trump, into several offshore accounts.
Extensive Documentation Reviewed
The Washington Post’s examination of the case reveals a trove of documents, including a sealed indictment, undercover operation reports, emails, text messages, recorded conversation transcripts, prosecutorial evidence summaries, and affidavits supporting search and seizure warrants for phones, digital data, and bank accounts.
Trump Media Responds
In response to inquiries about the investigation, Jesse Binnall, a lawyer for Trump Media, stated that any alleged illegal activities had no ties to Trump Media.
False Allegations
Binnall stated that “any allegations against Trump Media are maliciously and transparently false.”
Attorney Denies Misconduct
In a statement, Tai Park, Shvartsman’s attorney, also firmly rejected any implications of misconduct. He emphasized that Shvartsman has entered a not guilty plea and anticipates his trial, where they expect a vindication.
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