National accounting firm accused of fraud affecting more than 1,500 SEC filings

(Adobe Stock)

The Securities and Exchange Commission accused the auditor of Donald Trump’s social-media company of massive fraud that affected more than 1,500 regulatory filings.

BF Borgers CPA PC and its founder, Benjamin Borgers, will be permanently suspended from practicing and appearing as accountants before the SEC, and will pay a total of $14 million in fines to settle the probe, the SEC said in a Friday release.

BF Borgers was among the top 10 auditing firms with the most publicly traded clients in 2023, according to the firm.

The firm has been heavily involved in the special purpose acquisition company, or SPAC, field. Among its Indianapolis-area SPAC clients were Royalty Management Corp. and American Resources Corp., both based in Fishers.

“Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets,” Gurbir Grewal, the SEC’s enforcement chief, said in a statement. “Because investors rely on the audited financial statements of public companies when making their investment decisions, the accountants and accounting firms that audit those statements play a critical role in our financial markets. Borgers and his firm completely abandoned that role, but thanks to the painstaking work of the SEC staff, Borgers and his sham audit mill have been permanently shut down.”

BF Borgers didn’t immediately respond to a request for comment Friday morning. The firm has been one of the most prolific auditors in the U.S. The most recent review of its audits by U.S. regulators found a 100% deficiency rate. In its order, the SEC described false audit work papers, “nonexistent work” and fabricated meetings.

The SEC didn’t immediately reply to a request for comment on BF Borgers’ work for Trump Media & Technology Group Corp. Trump Media “looks forward to working with new auditing partners in accordance with today’s SEC order,” a representative for the company said.

The regulator’s settlement with BF Borgers didn’t say whether Trump Media was one of the companies whose filings involved alleged fraud by the accounting firm.

Trump Media has used the Colorado-based accounting firm since 2022, and retained its services after it went public by merging with Digital World Acquisitions Corp., a special purpose acquisition company. Inspections by the Public Company Accounting Oversight Board haven’t yet covered BF Borgers’ audits of Trump Media.

The former president’s social-media company was the biggest client by market capitalization on BF Borgers’ client roster. Although the firm is one of the busiest in the US, more than 80% of its clients trade over-the-counter, meaning they are too small to meet the listing requirements of large exchanges, according to research firm Ideagen Audit Analytics.

BF Borgers has faced regulatory scrutiny in both Canada and the U.S. It scored poor marks on the last two annual inspections from the US audit regulator, with the PCAOB citing a 100% deficiency rate in the sample of audits it inspected for 2021 and 2022.

The audit watchdog said BF Borgers, which has hundreds of clients, more than doubled its clients between 2019 and 2021 but didn’t add more staff to handle the additional workload. Just one person was responsible for 147 audits, the regulator said in an expanded inspection report.