Auditor That Works for Trump Media Is Charged With Fraud


An accounting firm that audits the financial statements of hundreds of public companies including former President Donald J. Trump’s social media company can no longer do so, U.S. securities regulators said on Friday.

The Securities and Exchange Commission charged the firm, BF Borgers, with fraud, saying that it had failed to comply with accounting rules. In settling with the S.E.C., the firm agreed immediately stop filing audited statements on behalf of its clients.

The regulator held BF Borgers and its owner, Benjamin F. Borger, responsible for “deliberate and systemic failures” to comply with accounting rules. The accompanying settlement requires both the firm and Mr. Borgers to pay a total of $14 million in civil penalties. Many companies that used BF Borgers must now find new auditors.

Trump Media & Technology Group, the parent company of the Truth Social platform, has been a client of BF Borgers since 2022, according to regulatory filings. But for most of that time, Trump Media was a private company.

Trump Media only went public in March after completing its merger with a cash-rich shell company. Even though the company is not mentioned in connection with the BF Borgers settlement, shares of Trump Media fell around 4 percent in early trading following the news.

Trump Media, in a statement, said it “looks forward to working with new auditing partners in accordance with today’s S.E.C. order.”

In announcing the enforcement action and settlement, the S.E.C. said that BF Borgers, based in Colorado, had audited hundreds of public companies. Regulators said the violations affected more than 1,500 corporate filings.

Gurbir S. Grewal, the S.E.C. director of enforcement, called the failures at BF Borgers “one of the largest wholesale failures by gatekeepers in our financial markets.”

The S.E.C. said it found that the audit firm sometimes copied work it had previously done for clients and simply changed dates on filings. In the process, regulators said, the firm “falsely documented work that had not been performed.”

Audit firms play a critical role on Wall Street and are supposed to make sure that a public company’s financial statements are accurate and in order. Investors rely on financial statements that have been reviewed and certified by auditing firms in making investment decisions.

The S.E.C. release said there was “no known defense counsel” for BF Borgers. In settling with the S.E.C., the audit firm and Mr. Borgers neither admitted nor denied the charges.

The S.E.C. issued instructions to public companies on how to respond to the settlement. In the filing, the regulator said companies must file a regulatory notice when an audit firm resigns or is fired.



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