Trump Media's audit firm just got permanently barred from working as accountants for 'massive fraud'

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Trump Media & Technology Group's audit firm, BF Borgers, was permanently barred Friday from serving as accountants by the Securities and Exchange Commission over charges of "massive fraud."

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The SEC charged the firm with failure to comply with Public Company Accounting Oversight Board (PCAOB) standards in audits and reviews of more than 1,500 SEC filings between January 2021 and June 2023, the agency said. Gurbir Grewal, director of the SEC's Division of Enforcement, called BF Borgers a "sham audit mill."

BF Borgers agreed to pay a $12 million civil penalty to settle the charges, and managing partner Benjamin Borgers agreed to pay a $2 million civil penalty. Both agreed to permanent suspensions from serving as accountants before the SEC, effective immediately. They did not admit to or deny the SEC's findings.

"Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets," Grewal said in a statement. He said their "fraudulent conduct" put investors and markets at risk and undermined trust in U.S. markets.

The firm and Borgers were also charged with falsely representing their work to clients as compliant with PCAOB standards, fabricating audit documentation to make it look PCAOB compliant, and falsely stating in audit reports included in more than 500 public company SEC filings that its audits complied with the standards.

BF Borgers was still Trump Media's independent registered public accounting firm as of April 1, according to a filing with the Securities and Exchange Commission. It was first hired on Jan. 22 2022, when Trump Media was still a privately held company.

On March 29, the audit committee of Trump Media's board approved Borgers to stay on as the company's independent registered public accounting firm to audit its consolidated financial statements for the 2024 fiscal year, according to SEC filings.

This wasn't the first time that Lakewood, Colorado-based Borgers has been the subject of scrutiny over its business practices. The Canadian Public Accountability Board (CPAB) banned Borgers from accepting new audit clients in Canada, according to an enforcement action drafted in December. The company doesn't have offices in Canada and audited fewer than 50 Canadian reporting issuers, according to the CPAB document.

Last November, the American Institute of Certified Public Accountants' (AICPA) peer review program terminated Borgers' enrollment in the program for "failure to cooperate because the firm was found to be so seriously deficient in its performance that education and remedial, corrective actions are not adequate."