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Trump Media’s stock price fell Friday after its auditor was accused of “massive fraud.”
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The auditor BF Borgers did not comply with common accounting standards, the SEC said.
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Shares of the media company fell 9% Friday morning.
Shares of Trump Media fell further Friday after the Securities and Exchange Commission indicted the company’s auditor for a “massive fraud” scheme that lasted more than two years, according to a new report. deposit.
BF Borgers CPA PC, which audited Trump Media’s financial statements, committed “willful and systemic failures to comply” with public company accounting standards, the regulatory agency said.
The firm and its owner, Benjamin Borgers, were accused of “falsely representing to clients” that the audits would comply with Common Accounting Standards and of fabricating audit documents. These actions affected approximately 1,500 SEC filings between January 2021 and mid-2023, the SEC said. The order did not name any specific clients.
BF Borgers settled the SEC’s charges by paying a $12 million penalty, while Borgers, the owner, paid a separate $2 million penalty. The company’s operations were permanently closed, and Borgers also agreed to cease “appearing and practicing” as an accountant.
“Ben Borgers and his auditing firm, BF Borgers, were responsible for one of the greatest failures by the supervisors of our financial markets,” said Gurbir Grewal, director of the Enforcement Division of the SEC law, in a press release. “Because investors rely on the audited financial statements of public companies to make their investment decisions, accountants and accounting firms that audit these statements play a vital role in our financial markets. Borgers and his firm abandoned that role altogether, but thanks to the careful work of the SEC staff, Borgers and his fictitious audit factory were shut down for good.
Trump Media shares fell 9% Friday morning, but later pared their losses to about 4%. The company is now looking for a new auditor, it told Business Insider in an email.
“Trump Media looks forward to working with audit partners in accordance with today’s SEC order,” a TMTG spokesperson said.
BF Borgers did not immediately respond to a request for comment from BI.
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