BF Borgers, the independent accounting firm of Trump Media & Technology Group, was indicted Friday by the Securities and Exchange Commission with widespread fraud and accused of operating a “sham audit mill.”
The SEC has not made any allegations of wrongdoing against Truth Social’s owner, Trump Media (DJT), which is not mentioned in the regulator’s charges.
The SEC accused BF Borgers of “deliberate and systemic failures,” including “fabricating” audit documents and misrepresenting to clients that its work complied with accounting standards.
The agency described this as a “massive” fraud that occurred between January 2021 and June 2023 and affected more than 1,500 SEC filings and more than 500 public companies.
The SEC has imposed a severe sanction against BF Borgers, permanently suspending the firm from the practice of accounting with the agency effective immediately. The company and its owner, Benjamin Borgers, also agreed to collectively pay $14 million in fines.
“Borgers and its fictitious audit mill have been permanently shut down,” Gurbir Grewal, director of the SEC’s enforcement division, said in a press release.
Public companies that hired BF Borgers will need to find new accounting firms, the SEC warned in a separate statement Friday.
Trump Media has announced plans to do just that.
“Trump Media looks forward to working with new audit partners in accordance with today’s SEC order,” Trump Media spokesperson Shannon Devine told CNN in a statement.
According to filings, Borgers was Trump Media’s registered independent accounting firm before the social media company went public in March. Later in March, Trump Media’s audit committee approved the hiring of Borgers as the public company’s accounting firm.
Although Trump Media is perhaps BF Borgers’ highest-profile client, the company had 350 clients during that period subject to SEC rules, according to the agency.
The SEC’s review focused only on public companies, meaning BF Borgers’ work for Trump Media when it was private was not included.
BF Borgers did not respond to a request for comment.
Trump Media is chaired and majority owned by former President Donald Trump, who is also Truth Social’s most popular user.
Even though Trump Media has reached a Wall Street valuation of more than $9 billion, the company generates little revenue and Truth Social remains a relatively small player in the social media world.
Truth Social’s average daily active users in the U.S. on iOS and Android fell 19% year over year in April to 113,000, according to Similarweb, a data intelligence firm. X, the app formerly known as Twitter, has more than 300 times as many users.
The SEC found that of BF Borger’s 369 clients whose public filings included the firm’s audits and reviews, at least 75 percent were noncompliant with accounting standards.
This is not the first time that BF Borgers or its founder have found themselves in difficulty.
Since 2019, Colorado regulators have repeatedly taken disciplinary action against Borgers.
Last year, the International Association of Chartered Professional Accountants fired BF Borgers under its peer review program because the firm “was found to be so seriously deficient in its performance that training and corrective action and corrective measures are not adequate.
Trump Media announced at the end of March that BF Borgers would be its accountant.
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