The Securities and Exchange Commission accused the auditor of Donald Trump’s social media company of massive fraud affecting greater than 1,500 regulatory filings.
BF Borgers CPA PC and its founder, Benjamin Borgers, will likely be permanently suspended from practicing and appearing as accountants before the SEC and pays a complete of $14 million in criminal penalties to resolve the investigation, the SEC announced Friday release.
“Ben Borgers and his accounting firm BF Borgers were responsible for one of the greatest gatekeeper failures in our financial markets,” SEC Enforcement Director Gurbir Grewal said in an announcement. “Because investors rely on the audited financial reports of publicly traded companies to make investment decisions, the accountants and auditing firms that review these financial reports play a critical role in our financial markets. Borgers and his firm relinquished that role entirely, but thanks to the diligent work of SEC staff, Borgers and his sham audit factory were permanently closed.”
BF Borgers didn’t immediately reply to a request for comment Friday morning. The firm was one of the crucial prolific accounting firms within the United States. The most up-to-date review of its audits by US regulators found a deficiencies rate of 100%. In its order, the SEC described false audit work papers, “non-existent work” and fabricated meetings.
The SEC didn’t immediately reply to a request for comment about BF Borgers’ work for Trump Media & Technology Group Corp. Trump Media “looks forward to working with new audit partners pursuant to today’s SEC order,” an organization representative said.
The regulator’s settlement with BF Borgers didn’t say whether Trump Media was amongst the businesses whose filings covered alleged fraud by the accounting firm.
Trump Media has used the Colorado-based accounting firm since 2022 and retained its services after it went public by merging with Digital World Acquisitions Corp., a special-purpose acquisition company. The Public Company Accounting Oversight Board’s inspections haven’t yet covered BF Borgers’ audits of Trump Media.
The former president’s social media company was the most important customer on BF Borgers’ client list when it comes to market capitalization. Although the corporate is among the many busiest within the U.S., greater than 80% of its customers trade over-the-counter, meaning they’re too small to satisfy the listing requirements of major exchanges, in accordance with research firm Ideagen Audit Analytics.
According to the corporate, BF Borgers was among the many top 10 accounting firms with essentially the most listed clients in 2023.
The auditor has been subject to regulatory review in each Canada and the United States. The company performed poorly within the U.S. audit watchdog’s last two annual inspections, with the PCAOB citing a 100% deficiencies rate within the sample of audits it reviewed in 2021 and 2022.
The exam regulator said BF Borgers, which has tons of of clients, greater than doubled its client numbers between 2019 and 2021 but didn’t hire more staff to deal with the extra workload. Only one person was chargeable for 147 audits, the regulator said in an expanded inspection report.
