Three Major Truth Social Investors Arrested On Charges Of Insider Trading

Three Florida men have been arrested by federal authorities and charged with insider trading involving $22 million they made prior to former president Donald Trump’s failing Truth Social media company being taking public, the Associated Press reports.

The three men — Michael Shvartsman, 52, of Sunny Isles Beach, Florida; Gerald Shvartsman, 45, of Aventura, Florida; and Bruce Garelick, 53, of Fort Lauderdale, Florida — will make their first court appearance Thursday in Miami.

Michael Shvartsman, the AP reports, was the owner of Rocket One Capital LLC, a venture capital firm. His brother, Gerald Shvartsman, was Rocket One’s chief investment officer, according to court papers.

The indictment alleges that between June 2021 and November 2021 the men bought securities after Garelick was given a seat on the board of Digital World Acquisition Corp., which was created to take Truth Social public. Authorities also allege that Garelick then began sharing insider information with others.

According to the indictment, the men were invited to invest in the special purpose acquisition company, Digital World Acquisition Corp., and were provided confidential information that a potential target of DWAC and another acquisition company, Benessere Capital Acquisition Corp., was Trump Media & Technology Group.

Even though Trump isn’t implicated in the scheme, this is the latest blow to the former president’s attempts to merge DWAC with Trump Media, meaning the stock price may collapse and result in a death spiral for Trump Social, which still has fewer than 2 million users, compared to Twitter’s 353 million and Facebook’s 2.96 billion.

In recent weeks, there have been rumors that Trump may be rejoining Twitter as he ramps up his bid for the 2024 Republican presidential nomination.