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SEC charges auditor BF Borgers with fraud


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The auditing firm for Trump Media and the auditor’s owner were charged Friday with “massive fraud” by the Securities and Exchange Commission for accounting work that affected more than 1,500 SEC filings, the federal regulator announced.

The auditor, BF Borgers CPA, and its owner, Benjamin Borgers, have agreed to be permanently suspended from practicing as accountants before the SEC, and also agreed to pay a combined $14 million in civil penalties, without admitting or denying the allegations, the SEC said.

The agency, calling BF Borgers a “sham audit mill,” said the company and its owner “deliberately systematically failed to conduct” audits and quarterly reviews incorporated in more than 1,500 SEC filings from January 2021 through June 2023 in accordance with Public Company Accounting Oversight Board standards.

The SEC said the Lakewood, Colorado-based auditor lied to clients by saying its work complied with PCAOB standards, fabricated audit documents to make it seem that the work did comply with those standards, and falsely claims in audit reports included in more than 500 public company SEC filings that the firm’s audits complied with such standards.

BF Borgers during the period covered by the SEC complaint acted as the auditor for Trump Media, which was then privately held and moving toward a planned merger with the publicly traded shell company Digital World Acquisition Corp.

Trump Media and DWAC finalized that merger in late March 2024, leading to Trump Media becoming publicly traded under the DJT ticker.

Three days after the company went public, Trump Media’s board approved keeping BF Borgers on as the company’s auditors for 2024.

BF Borgers Offices in Lakewood, Colorado.

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“Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets,” the SEC’s enforcement division director, Gurbir Grewal, said in a statement.

“As a result of their fraudulent conduct, they not only put investors and markets at risk by causing public companies to incorporate noncompliant audits and reviews into more than 1,500 filings with the Commission, but also undermined trust and confidence in our markets,” Grewal said.

BF Borgers did not immediately respond to requests for comment by CNBC.

The bombshell SEC action raised questions about the accuracy of the financial information in thousands of reports that were issued by the companies Borgers audited, including Trump Media, whose majority shareholder is former President Donald Trump.

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These reports, filed regularly with the SEC, provide essential information that investors and analysts use to evaluate companies whose stock trades on public markets.

The SEC said that reports filed by companies that used BF Borgers as its auditors “do not necessarily need to be amended solely because of the Commission’s entry of the Order.”

“However, issuers should consider whether their filings may need to be amended to address any reporting deficiencies arising from the BF Borgers engagement,” the SEC said, while also noting that companies that had used Borgers now need to find a new qualified public accountant.

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As of Friday morning, the investor relations page on Trump Media’s website still listed BF Borgers as the independent auditor of the company.

But Trump Media spokeswoman Shannon Devine told CNBC, “Trump Media looks forward to working with new auditing partners in accordance with today’s SEC order.”

The share price of Trump Media, which owns the Truth Social app, on Friday was down as much as 9% before paring back that loss to a decline of 1.7%.

— Additional reporting by CNBC’s Brian Schwartz.

Correction: The auditor, BF Borgers CPA, and its owner, Benjamin Borgers, agreed to pay a combined $14 million in civil penalties, without admitting or denying the allegations, the SEC said. An earlier version misstated the terms.

This is breaking news. Please check back for updates.

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