Investor Involved in Trump SPAC to Alter Plea in Insider Trading Lawsuit

Investor Involved in Trump SPAC to Alter Plea in Insider Trading Lawsuit

(Bloomberg) — One of three investors charged with insider trading in connection with the listing vehicle that took Donald Trump’s media company public intends to change his not guilty plea in the case less than a month before a trial in federal court. to start.

Most read on Bloomberg

U.S. District Judge Lewis J. Liman scheduled a change of plea hearing Monday for later in the week, but did not specify in his order how Michael Shvartsman would plead. These entries generally reflect a decision by defendants to admit guilt to at least one charge. Prosecutors and attorneys for Shvartsman did not respond to requests for comment.

A trial is scheduled to begin April 29 against Shvartsman, CEO of Rocket One Capital LLC, his brother Gerald and Bruce Garelick, a Rocket executive and former Digital World Acquisition Corp. board member. They are accused of making more than $22 million trading confidential information about potential SPAC targets, including Trump Media & Technology Group Corp.

The three men were invited to invest in Digital World Acquisition and another SPAC, and they signed nondisclosure agreements that gave them access to confidential information about potential targets of the company, including Trump Media, according to the government.

Digital World announced a merger deal with Trump Media in October 2021, sending shares soaring and netting the three men millions of dollars in profits from trades they made previously, according to prosecutors. Shares of Trump’s media company debuted last week after the Digital World deal closed, providing a much-needed cash injection after years of delays.

The three men were arrested in June and charged with securities fraud, conspiracy and other charges. If convicted, they each face up to 25 years in prison on the most serious fraud charges, although they will likely receive less time under federal sentencing guidelines.

Read more: Trump meme stock soars, but for how long?

The case is US v. Shvartsman, 23-cr-307, US District Court, Southern District of New York (Manhattan).

Most read from Bloomberg Businessweek

©2024 Bloomberg LP

Source Reference

Latest stories