The Securities and Exchange Commission (SEC) recently charged auditing firm BF Borgers and its owner, Benjamin F. Borgers, with “massive fraud” in over 1,500 audits. This action was not related to their recent work for Trump Media and Technology Group, despite being hired just over a month ago. The charges against BF Borgers included failures to follow accounting rules, falsifying documentation to cover up their mistakes, and falsely claiming that their work met audit standards. As part of the settlement, BF Borgers agreed to pay a $12 million fine, while Benjamin Borgers agreed to pay $2 million. Both also agreed to permanent suspensions from handling SEC-related matters.
Trump Media had appointed BF Borgers as their auditor on March 28, as disclosed in their recent annual report. Prior to this, the company had changed auditors multiple times, with one resigning in July 2023 and another being terminated in March, just as BF Borgers was re-hired. In response to the SEC charges, Trump Media stated that they will be seeking new auditing partners.
The SEC investigation revealed that BF Borgers had taken shortcuts, including copying previous audit documentation, altering dates, and falsifying approvals. Gurbir Grewal, director of the SEC’s enforcement division, described Borgers’ actions as one of the largest failures by financial market gatekeepers. Following the investigation, BF Borgers and Benjamin Borgers have been permanently banned from handling SEC matters.
Vocabulary List:
- Fraud (noun): Wrongful or criminal deception intended to result in financial or personal gain.
- Auditing (noun): The official financial inspection of individual or business accounts.
- Documentation (noun): Material that provides official information or evidence.
- Settlement (noun): An official agreement intended to resolve a dispute or conflict.
- Resigning (verb): Voluntarily leave a job or position.
- Terminated (verb): Ended the employment or contract of someone.
