Trump's Truth Social on the ropes after SEC questions 'unreliable' financial statements: Forbes

Questions about errors in financial filings made by the special purpose acquisition company looking to merge with Donald Trump's media company are putting the whole Truth Social deal at risk, reports Forbes.

The report states that financial documents provided by Digital World Acquisition Corp contain accounting errors that earned both a rebuke and a warning from the SEC.

As Forbes' Katherine Hamilton wrote, a filing by the SEC pointed to discrepancies in their annual financial report for 2022 and that investigators consider them untrustworthy at a time when they are pondering approving the merger.

The report states that a delisting on Nasdaq may be in the cards as officials Digital World officials scramble to make corrections.

"The year-end report can 'no longer be relied upon,' SEC regulators said, and Digital World is now developing a remediation plan to address the 'material weakness' in its 'internal control over financial reporting, per the filing," reports Forbes before adding, "Digital World Acquisition also has not filed an earnings report for the first quarter of 2023, which is required for all companies listed on Nasdaq."

In early April, Forbes reported that the declining fortunes of the struggling Truth Social have hit Donald Trump hard in the pocketbook, with the report stating, "The fundamental problem is that barely anyone uses Truth Social."

"Before it launched, an investor presentation suggested the app would attract 81 million users by 2026. Now, over a year after going live, it has only an estimated 5 million. Given that Trump owns roughly 85 percent of the business, [the] former president’s stake probably adds up to about $180 million today. Even that might be too much."