A financial executive, Bruce Garelick, has been convicted of enabling his boss and others to make over $22 million illegally through insider trading. The illegal trading occurred ahead of the public announcement of a special purpose acquisition company, Digital World Acquisition Corp., merging with Trump Media & Technology Group. Garelick sat on the board of DWAC and was found guilty of tipping others off about the impending merger. Despite his defense during the trial, Garelick was convicted of all charges by a jury in Manhattan federal court.
Garelick’s co-defendants had already pleaded guilty before the trial, admitting to their involvement in the illegal trading scheme that resulted in profits of over $22 million. Garelick, who was the chief investment officer of Rocket One Capital LLC at the time of the crimes in 2021, remains free on bail until his sentencing, which is scheduled for September 12. The indictment against the men did not implicate former President Donald Trump or Trump Media & Technology Group, which launched Truth Social on the NASDAQ stock market.
The venture capital firm where Garelick worked, Rocket One Capital LLC, was owned by Michael Shvartsman and based in New York. Shvartsman and his brother, Gerald Shvartsman, both of Florida, had already pleaded guilty to insider trading charges related to the DWAC merger. They are set to be sentenced in July. During Garelick’s testimony, he maintained that he did not possess any insider information about the merger when he bought DWAC securities that eventually led to his profits. However, the prosecutor challenged him with statements he made after the public announcement of the merger deal, suggesting that he knew insider information that led to significant profits.
The illegal trading scheme that Garelick was convicted of took place in 2021 when he was working in a leadership role at Rocket One Capital LLC. While Garelick primarily worked in the Boston area throughout his career, his involvement in DWAC’s insider trading led to his conviction. Despite claiming that he followed the law by not sharing any secrets with others, Garelick was found guilty of tipping others off to the impending merger for personal profit. The jury’s decision in Manhattan federal court convicted Garelick of all charges, leading to a future sentencing date for the financial executive.
Throughout the trial, Garelick maintained his innocence regarding the accusations of insider trading and sharing secrets about the DWAC merger. He testified that he did not possess any information that would constitute insider trading and that he had not shared any unlawful information with others. However, during cross-examination, a prosecutor pressed Garelick on statements he made after significant profits were made from the DWAC merger. Garelick admitted to saying, “We made $20 million dollars on it,” suggesting potential knowledge of insider information that led to illegal profits. Despite his defense, the jury found Garelick guilty of all charges related to insider trading around the DWAC merger.
