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As we’ve discussed at rather tedious length in these virtual pages, there are essentially no rules when it comes to special purpose acquisition companies. Certainly, there are none of the annoying disclosure rules that come with the traditional avenues to going public, which is of course the point. There is, however, one rather important rule when it comes to launching a blank-check company, and that is that the check your investors are writing actually be blank; that there be no name even so much as lightly penciled-in on the “pay to the order of” line.

But, as The New York Times pointed out, the words “Trump Media & Technology Group” were not-even-that-faintly scrawled on the novelty-sized check in Patrick Orlando’s office even before he raised his Digital World Acquisition Corp. SPAC, no matter how big an unpleasant surprise the eventual tie-up between the former president’s non-existent social and digital media empire and the blank-check company they’d invested in proved to Boaz Weinstein. That, unsurprisingly, is very interesting to one Gary Gensler, who likes neither Donald Trump nor the very concept of the SPAC.

The SEC is investigating a potential merger between Trump Media & Technology Group and the special-purpose acquisition company Digital World Acquisition Corp., Digital World disclosed in a regulatory filing Monday…. Mr. Trump met with Digital World Chief Executive Patrick Orlando early this year, before the SPAC had raised money. If the meeting is deemed to have represented substantive deal talks, it could violate SEC rules. SPACs aren’t supposed to have a target company identified at the time they initially raise money, analysts say….

Shares of the Digital World SPAC taking Mr. Trump’s company public fell 2.6% to $43.81 Monday. They have still roughly quadrupled since the deal was announced, though they are well below an October intraday peak of $175 after individual investors piled into the stock.

Which makes it seem a pertinent question to ask whether, having given hedge fund manager Bruce Kallins the best month of his career, whether DWAC may be about to give him one or two (or more) of his worst.

His event-driven fund, Yakira Partners, gained roughly 12% in October, far better than peers. The fund got a big boost from its stake in Digital World Acquisition Corp., a special purpose acquisition company that announced late in the month that it would merge with Trump Media & Technology Group Corp.

And lest you think that the SEC’s information-seeking around DWAC and TMTG is nothing but a partisan witch hunt, let Gensler assure you that his hatred for blank-check funny business knows no ideological bounds.

Upstart electric vehicle maker Lucid Motors disclosed Monday it has received a subpoena from the SEC, sending its shares plunging 10% in early trading.

The company said the probe "appears to concern" the SPAC deal that took it public earlier this year, along with "certain projections and statements."

Trump, Lucid SPAC Deals Being Investigated by SEC [WSJ]
Lucid Motors subpoenaed by the SEC. Shares plunge [CNN]
Trump SPAC Delivers Best Month Ever for Hedge Fund Veteran [Bloomberg]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

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