An accounting firm that handled former President Donald Trump‘s social media company has been accused of “massive fraud” and shut down by the U.S. Securities and Exchange Commission (SEC).
Gurbir Grewal, director of the SEC’s enforcement division, called BF Borgers a “sham audit mill” in a press release on Friday. The firm is accused of “deliberate and systemic failures” in independent audits and reviews that were later included in more than 1,500 SEC filings for public companies from January 2021 to June 2023.
Trump Media, which owns the former president’s Truth Social platform, used BF Borgers as its accounting firm before becoming a public company in March. BF Borgers is not accused of committing any fraud regarding Trump Media, as the work it did with the company falls outside of the scope of the SEC investigation.
BF Borgers and owner Benjamin Borgers were ordered to immediately stop practicing as accountants before the commission and to pay a combined civil fine of $14 million. Companies that used the firm for SEC purposes were also told to find a different qualified accountant.
A Trump Media spokesperson told Newsweek via email that the company “looks forward to working with new auditing partners in accordance with today’s SEC order.”
The SEC investigation concluded that “at least 75 percent” of filings that involved BF Borgers reviews and audits did not comply with federal standards, while the firm is accused of passing off its work by “fabricating audit documentation to make it appear that the firm’s work did comply” with the standards and lying to clients.
“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. “They not only put investors and markets at risk … but also undermined trust and confidence in our markets.”
“Thanks to the painstaking work of the SEC staff, Borgers and his sham audit mill have been permanently shut down,” he added.
While Trump himself is by far the most popular prolific user of Truth Social, Trump Media stock shares were in high demand earlier this year, skyrocketing in value shortly after the company went public before sharply declining.
The price of the stock, of which Trump owns about 60 percent, has recently become somewhat more stable, although many experts continue to scratch their heads over the company’s high valuation.
Trump Media stock as been compared to the “meme stocks” that have artificially spiked in value in recent years due to online activity, with some suggesting that enthusiastic Trump supporters could have helped drive the price up.
A Trump Media SEC filing in April revealed that the company made just over $4.1 million in revenue in its last operating year, while losing almost $58.2 million. Despite this, the company is valued at over $6 billion on the stock market.
As of April, there were only around 113,000 active daily users of Truth Social, a drop of nearly 20 percent from the previous year, according to CNN.
Uncommon Knowledge
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