“Regulator Closes Trump Media Auditor for Fraud”

The US regulatory body for stock markets, the Securities and Exchange Commission, has forcefully closed the audit firm of Donald Trump’s social media enterprise, accusing it of monumental fraudulent activity. The agency imposed charges on BF Borgers, the company in question, and its establishing partner, Ben Borgers, last Friday. They allegedly misled clients by declaring their audits adhered to American standards, while forging paperwork.

It was contended that Borgers, recognised as one of the most active auditors of US publicly traded firms, had instigated one of the biggest lapses by financial market supervisors. Without either denying or admitting to the SEC’s findings, the accused firm has evidently consented to paying a penalty of $12 million (€11.15 million), in addition to Ben Borgers agreeing to pay $2 million. Mr Borgers didn’t immediately furnish any comments on the situation.

Despite the rapid expansion of Borgers, becoming an auditor for hundreds of small and micro corporations – inclusive of the previous US president’s Trump Media & Technology Group – the SEC declared that three-fourths of its audits were flawed. The SEC has stepped in to put a permanent end to what they’ve labelled a “colossal fraud” and a “mockery of an audit facility”. In order to rectify potential errors they asked Borgers’ clients to reassess previously submitted financial assessments. The SEC stated that the firm’s “wilfully systematic failure” to satisfy professional guidelines has impacted over 1,500 filings by companies.

Managed from a single story building in a Denver, Colorado suburb, Borgers had managed to amass one of the largest client portfolios for any US audit firm in just a decade and half. Currently, the firm only has 50 employees, and Mr Borgers himself signed off over 140 audit opinions last year, as evidenced by Ideagen Audit Analytics – a much larger amount compared to any other US accountant.

Warnings regarding the quality of his work were raised by regulators. The Public Company Accounting Oversight Board revealed 100% deficient in inspected audits conducted by his firm. Receving a fine of $5,000 from the Colorado state board of accountancy for retirement plan audits and banned from operating in Canada by the national audit regulator last year are among other issues Borgers has faced.

Having been banned from operating as a public accountant by the SEC, there are now over 170 public entities in the US tasked with finding a new audit firm; a problem that seemed to impact share prices last Friday.

“Trump Media is eager to engage with fresh auditing associates, as directed by the recent SEC decree,” stated the organisation.
The overseeing body indicated it would keep a close eye on the matter, informing firms of their limited rights to delay submission of their fiscal reports if required.
The SEC voiced that, “Paperwork submitted before the directive’s date of effect needn’t be adjusted solely due to the instruction,” however, it supplemented this by saying: “Companies should contemplate whether alterations might be necessary to rectify any reporting inadequacies that have stemmed from involvement with BF Borgers.” – Copyright The Financial Times Limited 2024

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