Achi news desk-
The auditor of former president Donald Trump’s Trump Media was accused of running a “massive fraud” and a “bogus audit mill” by the US’s top financial regulator on Friday.
BF Borgers and its owner Benjamin Borgers, whose clients include Trump Media, were charged by the US Securities and Exchange Commission (SEC) with fraud that affected more than 1,500 SEC filings. Borgers has also acted on behalf of fintech and crypto companies, according to SEC filings.
BF Borgers agreed to pay a civil penalty of $12m, and Benjamin Borgers agreed to pay a civil penalty of $2m, to settle the SEC’s civil charges. They also agreed to permanent suspensions from practicing as accountants on SEC filings, effective immediately.
Borgers has been a Trump Media auditor since 2022, according to his filing. Trump Media owns Donald Trump’s Truth Social social media platform.
It was not immediately clear which files or companies were affected.
“Trump Media looks forward to working with new audit partners in accordance with today’s SEC order,” a spokeswoman for Trump’s media company wrote in an email.
According to the SEC, Borgers did not properly prepare and conduct audit documentation, falsified audit planning meetings and in some cases only passed previous audits for the current audit period.
“Ben Borgers and his auditing firm, BF Borgers, were responsible for one of the largest wholesale failures of gatekeepers in our financial markets,” said Gurbir Grewal, director of the SEC’s enforcement division.
“As a result of their fraudulent conduct, they not only put investors and markets at risk by causing public companies to incorporate non-compliant audits and reviews into more than 1,500 filings with the commission, but also undermine trust and confidence in our markets.”
Of the 369 BF Borgers clients whose filings between January 2021 and June 2023 incorporated BF Borgers audits and reviews, at least 75% incorporated audits that did not comply with SEC rules.
BF Borgers acted on behalf of Trump Media during the SEC complaint period. In late March, Trump Media merged with a publicly traded shell company, Digital World Acquisition Corp, in a deal that valued the social network minnow at close to $8bn. The company now trades under the ticker symbol “DJT”, using Trump’s initials.
Trump Media shares have fallen sharply since their debut but despite doubts about the value due to the small size of the social media site and the financial difficulties of the company, the stock has continued to give a significant boost to the wealth of the former president.
Trump Media’s share price fell over 5% on Friday but ended the day down 1.54% and is up nearly 14% over the past five trading days. The company is now worth more than $6.5bn. Trump is the company’s largest shareholder and recently qualified for a bonus for the company’s share performance that boosted the paper value of his stake to $3.7bn.
Reuters contributed to report
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