The US SEC has shut down the auditor of Donald Trump’s social media company, accusing it of 'massive fraud'
BF Borgers and its owner, Benjamin Borgers, who counts Trump Media among his clients, faced charges from the US Securities and Exchange Commission (SEC) for a fraud that impacted over 1,500 SEC filings. Borgers has also represented financial tech and cryptocurrency companies, as per SEC filings.
In settling the SEC's civil charges, BF Borgers agreed to pay a $12 million civil penalty, while Benjamin Borgers agreed to pay a $2 million civil penalty. Both also accepted permanent suspensions from practicing as accountants on SEC filings, effective immediately.
Borgers had been the auditor for Trump Media since 2022, according to its filings. Trump Media is the owner of Donald Trump’s Truth Social media platform.
It remains unclear which filings or companies were affected by the fraud.
“Trump Media looks forward to working with new auditing partners in accordance with today’s SEC order,” a spokesperson for Trump’s media company stated in an email.
The SEC found that Borgers had not appropriately prepared and maintained audit documentation, had fabricated audit planning meetings, and in some instances had simply reused previous audits for the current audit period.
“Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets,” said Gurbir Grewal, director of the SEC’s division of enforcement.
“Their fraudulent conduct not only endangered investors and markets by causing public companies to include noncompliant audits and reviews in over 1,500 filings with the commission, but also eroded trust and confidence in our markets.”
Of the 369 clients of BF Borgers whose filings from January 2021 through June 2023 included BF Borgers’ audits and reviews, at least 75% had audits that did not comply with the SEC’s rules.
BF Borgers represented Trump Media during the period covered by the SEC’s complaint. In March, Trump Media merged with a publicly traded shell company, Digital World Acquisition Corp, in a deal valuing the small social network at nearly $8 billion. The company now trades under the ticker symbol “DJT”, using Trump’s initials.
While Trump Media’s shares have fallen significantly since their debut, the stock has boosted the former president’s wealth due to optimism about its potential, despite concerns about the social media site’s size and the company’s financial troubles.
Trump Media’s share price declined over 5% on Friday but has risen by close to 10% over the past five trading days. The company is currently valued at over $6.3 billion, with Trump as its largest shareholder. He recently became eligible for a bonus based on the company’s share performance, increasing the paper value of his stake to $3.7 billion.