Investor convicted in Trump Media insider trading case

A federal jury in New York on Thursday convicted an investor of insider trading in the stock of a shell company ahead of its announcement in October 2021 that it would merge with Trump Media.

The investor, Bruce Garelick, had been on the board of directors of the publicly traded company, Digital World Acquisition Corp., at the time he was accused of sharing and exploiting non-public information with others about its plans to merge with then-privately held Trump Media, the owner of the Truth Social app.

Trump Media’s majority shareholder is former President Donald Trump, who was not accused of any wrongdoing in the case against Garelick in U.S. District Court in Manhattan.

But Garelick’s trial, which began on April 30, took place just blocks away from where Trump is on trial in Manhattan Supreme Court on criminal charges related to a hush money payment to porn star Stormy Daniels.

Two co-defendants of Garelick, the brothers Michael and Gerald Shvartsman, pleaded guilty to insider trading charges on April 3.

Jurors in Garelick’s case began deliberating on Wednesday afternoon after hearing closing arguments from prosecutors and a defense lawyer. After several hours of deliberation Thursday, jurors returned guilty verdicts on the five counts of securities fraud and conspiracy that the 54-year-old Garelick faced.

Garelick, who testified at his trial, is scheduled to be sentenced on Sept. 12.

Garelick was an investment advisor to Michael Shvartsman’s venture capital firm, Rocket One Capital. Prosecutors said Garelick shared non-public material information about DWAC’s merger plans with Trump Media with the Shvartsman brothers in 2021 after joining DWAC’s board.

All three men then bought up DWAC stock based on that non-public