Pedestrians walk past the Nasdaq building as the stock price of Trump Media & Technology Group Corp. is displayed on screens, March 26, 2024, in New York. An auditing firm hired by Trump Media and Technology Group just 37 days ago was busted by the Securities and Exchange Commission for “massive fraud” — though not for any work it performed for former President Donald Trump’s media company. The Canadian Press
An auditing firm recently hired by Trump Media and Technology Group has been accused of "massive fraud" by the Securities and Exchange Commission (SEC), marking a tumultuous turn just 37 days into their partnership. The SEC's charges target BF Borgers and its owner, Benjamin F. Borgers, citing a litany of failures spanning over 1,500 audits. These failures range from disregarding accounting regulations to falsifying documentation to cover up their inadequacies, along with falsely asserting compliance with audit standards in their reports.
As part of a settlement with the SEC, BF Borgers has agreed to a hefty fine of $12 million, while Benjamin Borgers will pay $2 million. Both parties have also consented to permanent suspensions, effective immediately, preventing them from engaging in SEC-related accounting matters in the future. Despite attempts to reach Benjamin Borgers for comment, there has been no response thus far.
Trump Media enlisted BF Borgers as its auditor on March 28, as indicated in the company's most recent annual report filing. This move followed the handling of audits by BF Borgers before the company's public listing through a merger with Digital World Acquisition Corp. However, the company's auditing journey has been turbulent, with at least two prior auditors exiting the scene, one in July 2023 and another being terminated in March, coinciding with the re-engagement of BF Borgers.
In response to the SEC's findings, Trump Media expressed its readiness to cooperate with new auditing partners in compliance with the SEC's directives. The SEC's investigation revealed BF Borgers' shortcuts, which included recycling audit documentation from past years, altering dates, and presenting it as current documentation. Moreover, the falsified documentation portrayed planning meetings with clients that never took place and misrepresented approvals from both Benjamin Borgers and another reviewer.
Gurbir Grewal, the director of the SEC's enforcement division, condemned Benjamin Borgers and BF Borgers for what he termed as "one of the largest wholesale failures by gatekeepers in our financial markets." He credited the meticulous efforts of SEC staff for permanently shutting down Borgers' fraudulent audit operations.
