This sounds a lot like the “Wolf of Wall Street.”
Such Great Heights
Executives at the Manhattan bank that funded Donald Trump’s Truth Social are accusing each other of blowing millions of dollars on partying, gambling, and sex workers.
As the Wall Street Journal reports, two money men from the financial firm EF Hutton have aired each others’ dirty laundry in a pair of dueling — and now retracted — lawsuits.
Despite an august history in the financial sector, EF Hutton had fallen on hard times by 2021, when bankers Joseph Rallo and David Boral resurrected the brand.
Though they’d funded other ventures, including the now-flailing plant-based food startup Veg House, the feather in the newly revived EF Hutton’s cap was its stake in Truth Social. Using a special purpose acquisition company (SPAC) called Digital World Acquisition, the deal made the resuscitated bank $15 million on fees and shares alone.
After Truth Social’s launch in 2022, Rallo and Boral made even more millions as EF Hutton’s new digital media star grew. The pair funded a few other small companies’ initial public offerings (IPOs) and SPACs, and then-CEO Rallo bought a $25 million penthouse on Manhattan’s tony Upper East Side.
But just a few months after Truth Social went public under the ticker DJT earlier this year, the feds came knocking at Rallo’s door under a search warrant obtained as part of a fraud investigation.
Countersuit Up
This revelation, as well as Rallo’s extravagant tastes, came out during a lawsuit filed by EF Hutton against its now-former CEO. In the suit, the firm alleges that Rallo stole millions from its bustling coffers to fund everything from New York Knicks playoff tickets and private jets to repaying growing gambling debts.
In response, Rallo shot off his own countersuit claiming that a jealous Boral had used company money to pay prostitutes — and that when he saw an opening, he had ousted his former business partner in a “coup d’etat.”
Specifically, the countersuit alleges that after celebrating Truth Social’s successful IPO in Palm Beach, FL, Boral paid a sex worker $500 from an EF account in error. When the payment was flagged at the firm, Rallo purportedly attempted to cover it up.
Earlier this week, both EF and Rallo dropped their lawsuits and the firm announced that it was disbanding. Per their agreement, Boral will remain in control of the broker-dealer registration under the brand while Rallo retains ownership of the brand itself.
As for these suits’ relationship to Trump and Truth Social, a spokesperson for the firm responded to the WSJ‘s request for comment in a hilariously rude manner.
“Roping [Trump Media and Technology Group] into a story about events in which we played no role whatsoever is a hilarious example of this reporter’s all-encompassing biases,” the spokesperson spat.
More on Truth Social: Trump’s “Truth Social” Crumbling Behind the Scenes as Staff Catch It Doing Something Extremely Anti-MAGA
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