The IT Nerd

I have to admit that what I read in this Gizmodo story wasn’t on my BINGO card for today. But here I am talking about it. Though perhaps I shouldn’t be shocked by this.

Gizmodo submitted a Freedom of Information Act (FOIA) request with the FTC for consumer complaints about Truth Social filed in the past two years. The complaints to the federal agency include some stories from people who’ve been banned from the site (unjustly, they claim) and others who say they got signed up for mailing lists they never wanted to be on in the first place. But the complaints about scams are the most shocking, if only because there are such large sums of money involved. And we’re publishing a sample of the full, unedited complaints below.

One person who says they lost $170,000 explained they were initially scammed on a different site but met someone on Truth Social who claimed they could help get their money back. That turned out to be a scam as well. But more often, the victims are first contacted on Truth Social before being told to take the conversation somewhere else, like WhatsApp. Truth Social seems to be a target-rich environment for people who are easy to con.

Another thing that sticks out about the complaints filed with the FTC is that they seem to involve plenty of elderly fans of Donald Trump. One 72-year-old man who reported chatting with a “beautiful” woman on the site was scammed out of $21,000. His complaint ends with, “I haven’t told my wife about this blunder. She still doesn’t know about it.” Another person in their 60s said they lost $500,000 to scammers on Truth Social and seemed to think there might be a way they could get their money back, telling the FTC, “After I pay this they promise there will be no more fees and I will receive my assets.”

I encourage you to read the scams that are listed in this article. Now some of this is the stuff that I see when I get called in to help with the aftermath of someone being scammed. But the dollar amounts that are being highlighted here are mind blowing. The most expensive scam that was successful that I’ve come across was about $4000 CDN. The biggest dollar amount that a threat actor tried to get from a client of mine was about $50000 CDN. This article has examples well north of $100000 USD which is insane.

So you might be wondering, what is Truth Social doing to stop this. Here’s what they said:

Gizmodo tried to contact representatives from Truth Social on Thursday, but after sending an email to the address listed for media organizations on the social media platform’s website, it bounced back as undeliverable. After finally getting a hold of someone at something called the MZ Group, which works for Trump Media & Technology Group, the owner of Truth Social, the representative said they have “a robust team that actively searches for scams and bots on the platform and bans them as soon as they’re found.” Follow-up questions did not receive a response.

I think that this translates to they’re doing nothing substantial to stop scams on the platform. But I might be reading that wrong. But what this shows is that Truth Social is a target rich environment for threat actors who can scam with impunity. And that’s not surprising because this was a site that was literally thrown together quickly to give Donald Trump someplace to share his thoughts after he got kicked off Twitter, Facebook and other forms of social media after the January 6th insurrection. It wasn’t designed to stop this sort of thing from happening. Nor do I believe that Truth Social has the will to stop this sort of thing from happening. Now combine that with the sort of person who goes to Truth Social who are far more likely to fall for this sort of stuff and you get this situation. For those two reasons, I believe that you fully expect more people to be scammed on Truth Social for a whole lot of money, and little if anything done by Truth Social to stop it.

Truth Social is exactly what the title suggests. It’s a dumpster fire. I’m going to speak to two examples of this. Starting with infighting within the company that’s led to a lawsuit:

The media company that Donald Trump recently took public is suing its co-founders, accusing them of failing “spectacularly” to get the company off the ground and then trying to “thwart the deal.”

The lawsuit filed in Sarasota County, Florida, civil court seeks to bar Trump Media & Technology Group co-founders Wesley Moss and Andrew Litinsky from appointing members to the company’s board — or from owning any of its shares.

Moss and Litinsky claim that a 2021 agreement that Trump signed with a company they founded, United Atlantic Ventures, LLC, guarantees them an 8.6% share of Trump Media’s total stock, undiluted by the issuance of new shares.

At DJT’s closing price Tuesday, that share would be worth about $601 million.

In February, Moss and Litinsky sued Trump Media in Delaware Chancery Court over their stake in the company.

The Florida lawsuit was filed in late March, around the same time that shareholders in the shell company Digital World Acquisition Corp. voted to approve a merger with Trump Media, a private company behind the fledgling social media app Truth Social.

Following the special purpose merger, stock in the newly public Trump Media began trading under the ticker DJT and shot up by as much as 50% in its Nasdaq debut last week.

But the share price fell sharply Monday, after the company disclosed a $58.2 million net loss in 2023.

Trump Media’s lawsuit wants the court to award it damages for what it claims are Moss and Litinsky’s “breaches of fiduciary duty.”

In addition to Moss and Litinsky, the lawsuit names DWAC founder Patrick Orlando a co-defendant, accusing him of being involved in those breaches.

Moss and Litinsky were responsible for establishing Trump Media’s corporate governance structure, preparing the launch of Truth Social and finding a shell company for a merger to take the media company public, the lawsuit says.

This is kind of comical and illustrates the kind of chaos that exists at this company. And based on this latest event, one wonders if there will ever be a positive outcome that will result in everyone making money. My guess is not, but I am free to be proven wrong on that front.

Speaking of money. There’s a report in The Guardian that suggests that Truth Social was financially floated by someone who will raise eyebrows:

Donald Trump’s social media company Trump Media managed to go public last week only after it had been kept afloat in 2022 by emergency loans provided in part by a Russian-American businessman under scrutiny in a federal insider-trading and money-laundering investigation.

The former US president stands to gain billions of dollars – his stake is currently valued at about $4bn – from the merger between Trump Media and Technology Group and the blank-check company Digital World Acquisition Corporation, which took the parent company of Truth Social public.

But Trump Media almost did not make it to the merger after regulators opened a securities investigation into the merger in 2021 and caused the company to burn through cash at an extraordinary rate as it waited to get the green light for its stock market debut.

The situation led Trump Media to take emergency loans, including from an entity called ES Family Trust, which opened an account with Paxum Bank, a small bank registered on the Caribbean island of Dominica that is best known for providing financial services to the porn industry.

Through leaked documents, the Guardian has learned that ES Family Trust operated like a shell company for a Russian-American businessman named Anton Postolnikov, who co-owns Paxum Bank and has been a subject of a years-long joint federal criminal investigation by the FBI and the Department of Homeland Security (DHS) into the Trump Media merger.

The existence of the trust has previously been reported by the Guardian and the Washington Post. However, who controlled the account, how the trust was connected to Paxum Bank, and how the money had been funneled through the trust to Trump Media was unknown.

The new details about the trust are drawn from documents including: Paxum Bank records showing Postolnikov having access to the trust’s account, the papers that created the trust showing as its settlor a lawyer in St Petersburg, Russia, and three years of the trust’s financial transactions.

That all sounds more than a little suspect to say the least. I honestly wouldn’t be surprised that at some point, a three letter federal agency starts executing search warrants and/or arresting people. Which in turn will likely cause Truth Social to crash and burn.

We seriously live in strange times at the moment.

So when we last looked at the other train wreck next to the dumpster fire in social media that is known as Truth Social, the company merged with Digital World Acquisition Company which as part of the deal took Truth Social public. That looked good at the start, but now this is what their stock looks like:

So as you can see, there was a spike when the merger happened. But it’s fallen off a cliff since. Why you ask? Yahoo has the answer:

The stock drop comes on the heels of an updated regulatory filing early Monday that showed the company taking on heavy losses and facing “greater risks” associated with the former president’s ties to the platform.

According to the filing, Trump Media reported sales of just over $4 million as net losses reached nearly $60 million for the full-year ending Dec. 31. The company warned it expects losses to continue amid greater profitability challenges.

“TMTG has historically incurred operating losses and negative cash flows from operating activities,” the filing read.

“TMTG expects to continue to incur operating losses and negative cash flows from operating activities for the foreseeable future, as it works to expand its user base, attracting more platform partners and advertisers.”

Truth Social has lured about 9 million users since its inception. But its success largely depends on the “reputation and popularity” of former President Donald Trump.

“TMTG may be subject to greater risks than typical social media platforms because of the focus of its offerings and the involvement of President Trump,” the company said, citing risks that include the harassment of advertisers and criticism of Truth Social’s moderation practices.

“The value of TMTG’s brand may diminish if the popularity of President Trump were to suffer.”

Notably, Trump Media revealed it heavily relies on advertising with ad sales contributing to a “substantial majority of our revenue.”

“If we experience a decline in the number of users or a decline in user engagement, including as a result of the loss of high-profile individuals and entities who generate content on Truth Social, advertisers may not view Truth Social as attractive for their marketing expenditures, and may reduce their spending with us, which would harm our business and operating results,” the company warned.

Investors in this company have been introduced to reality. Which is business fundamentals trumps blind and illogical devotion to an individual. My question is how long will the investors in this stock wait until they pull the plug and sell which will make life very different for a certain Donald J. Trump who I am sure was hoping to seriously cash in on this.

The Truth Social circus has taken another twist with news that the merger with Digital World Acquisition Company was approved:

Trump Media, which runs the social media platform Truth Social, is poised to become a publicly listed company, after a majority of shareholders of Digital World Acquisition Corp voted on Friday to acquire it.

Mr Trump is due to have a stake of at least 58% in the merged company, worth roughly $3bn at Digital World’s current share prices.

It’s an astonishing potential windfall for Mr Trump in exchange for a business whose own auditor warned last year it was at risk of failure.

Never mind the many red flags associated with the deal, including unresolved lawsuits from former business partners. There’s also an $18m settlement that Digital World agreed to pay last year to resolve fraud charges over how the merger plan came together.

Shares in Digital World rose on Friday ahead of the approval, to more than $45 apiece, before later sliding to below $40.

Now because of the red flags that were mentioned above, this could still become a dumpster fire. But this is a significant hurdle that has been passed for this troubled social media platform. Oh, and in case you were wondering, Donald Trump stands to eventually make billions from this. Though he needs cash right now and this might not help.

Reuters is reporting that Truth Social, which is Donald Trump’s attempt at running a social network, is bleeding cash like a gunshot victim. How much cash you ask? Have a look at this:

Former U.S. President Donald Trump’s social media platform Truth Social has lost $73 million since its launch in early 2022, a securities filing by Digital World Acquisition Corp, the SPAC that plans to merge with the company, showed on Monday.

Trump had announced the launch of his social media app in Oct 2021, saying it would “stand up to Big Tech” companies such as Twitter and Facebook that previously barred him.

In 2022, Truth Social posted a loss of $50 million, with net sales of just $1.4 million. It lost $23 million in the first half of this year, with net sales of $2.3 million.

Trump Media & Technology Group’s (TMTG) independent registered public accounting firm has indicated that the financial condition raises substantial doubt as to its ability to continue as a going concern, according to the filing.

And what makes this a potentially terminal event for Truth Social is this:

“TMTG believes that it may be difficult to raise additional funds through traditional financing sources in the absence of material progress toward completing its merger with Digital World.”

Here’s why I find this to be absolutely hysterical. Trump swiped code from Mastodon to build Truth Social and got into trouble as a result. Then he had to do some quick tap dancing to make those issues go away. That code cost him $0. But he’s somehow still losing money. I guess it proves that everything that Trump touches dies. Though I have to ask, if when Truth Social joins the pile of failed Trump ventures, will he go back to Twitter? Or will he pop up somewhere else? That will be interesting to see what happens on that front.

Seriously. In the last couple of days, the campaign team for President Joe Biden has set up a Truth Social account. In effect, making this the ultimate 5000 IQ move. Here’s why:

The @BidenHQ account, the official digital rapid response channel of the Biden-Harris campaign, joined Truth Social on Monday following a swift rise on other social media platforms since its launch early October.

The account then began posting their signature videos, starting with clips of Donald Trump’s opponents such as Ron DeSantis and Nikki Haley calling out Trump’s policies and statements.

Deputy Biden campaign manager Rob Flaherty commented on the new digital strategy on X, saying, “A thing about campaigns is sometimes you just do things for the lolz.”

In a statement to Fox News Digital, the Biden campaign said, “There’s very little ‘truth’ happening on Truth Social, but at least now it’ll be a little fun.”

Here’s where it gets funny. After two days, this account has more followers than the Trump campaign’s account:

The account passed 23K followers on Truth Social on Wednesday.

The Team Trump account, the official account of the Trump campaign on Truth Social, has fewer than 20K followers.

The reason why this is hysterically funny is that Truth Social is thought to be the home of MAGA nation. But based on this, that perhaps isn’t the case. And if you’re Trump, you have to feel a little less manly being trolled on your home turf. Sucks to be him.