As Use of SPACs Increase $8 Million Settlement Cautions Due Diligence
Highlights
Special Purpose Acquisition Companies obtain investor funds and then merge with a privately held company and take it public
The popularity of SPACs has increased exponentially over the past two years as a means of obtaining significant financial windfalls
As these transactions continue, executives and compliance professionals should consider conducting due diligence, following the SEC’s recent settlement agreement with Stable Road Acquisition Company, and other entities and individuals, for more than $8 million
The Securities and Exchange Commission (SEC) announced, on July 13, that it reached a settlement agreement with Stable Road Acquisition Company and its CEO Brian Kabot, and Momentus, Inc. for more than $8 million in connection to a proposed merger and misleading claims about Momentus’ technology. The SEC is continuing an action in the U.S. District Court for the District of Columbia against Momentus, Inc. former CEO Mikhail Kokorich.
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