The Securities and Exchange Commission (SEC) has charged, audit firm BF Borgers CPA PC  with “massive fraud, fining it $12 million and permanently suspending it from appearing and practicing before the the SEC as accountants, effective immediately. The SEC said its review of the firm’s audits found “deliberate and systemic failures” in more than 1,500 filings from January 2021 through June 2023. The agency called the firm a "sham audit mill" whose failures have "put investors and markets at risk."

The company had served as the accounting firm for Trump Media & Technology, which owns Truth Social, before it went public this past March. But given the timing of the audits that the SEC focused on, the filings by Trump Media were probably not among those investigated as part of the review, The Washington Post reported. In a statement reported by the Post a spokesperson said that Trump Media  “looks forward to working with new auditing partners in accordance with today’s SEC order.”

In its order, the SEC charged the Borgers firm and its owner, Benjamin F. Borgers, with “deliberate and systematic” auditing failures, such as fabricating audit documentation to make it appear that the firm’s audits complied with Public Company Accounting Oversight Board (PCAOB) standards in more than in more than 1,500 SEC filings from January 2021 through June 2023. It also charged the firm and Borgers with falsely stating in more than 500 public company SEC filings that its audit reports complied with PCAOB standards.

BF Borgers agreed to pay a $12 million civil penalty, and Benjamin Borgers agreed to pay a $2 million civil penalty, to settle the charges. The firm and Borgers also agreed to a permanent ban on auditing public company clients.

“Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets,” said Gurbir S. Grewal, director of the SEC’s Division of Enforcement, in a statement. “As a result of their fraudulent conduct, they not only put investors and markets at risk by causing public companies to incorporate noncompliant audits and reviews into more than 1,500 filings with the Commission, but also undermined trust and confidence in our markets. 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.”

Founded 15 years ago, Lakewood, Colo.-based Borgers quickly became one of the 10 largest audit firms in the country by number of clients, regulatory filings show, the Post reported.  Yet the firm has a fraction of the workforce of other auditing firms, with only 10 CPAs on staff, according to PCAOB filings. The next-closest firm with more than 100 clients, Cohen & Co., had 308 CPAs, while other firms, such as Ernst & Young and Deloitte & Touche, had more than 10,000, the Post reported.

The Financial Times reported that Ben Borgers himself signed off on more than 140 audit opinions in the past year, according to Ideagen Audit Analytics, far more than any other accountant in the United States.