When your accounting firm, which also serves as an auditor, is connected with the phrase “massive fraud,” it’s generally a good move to find a new accounting firm. Not at all surprisingly, that’s just what social media company Truth Social (NASDAQ:DJT) did, and investors applauded this slice of common-sense brilliance with an over 4% gain in share prices in Monday afternoon’s trading session.
The Securities and Exchange Commission (SEC) came down on BF Borgers, Truth Social’s former accounting firm, like the fist of an angry god, declaring Borgers to be a “…sham audit mill.” Further, the SEC accused Borgers of “…deliberate and systemic failures,” starting with making up documentation for audits and telling its customers that its work would certainly comply with accounting standards.
Thus was the kind of thing that went into a two-and-a-half-year odyssey of fraud, or so the accusations went, that ran from January 2021 to June 2023. That, in turn, represented a material impact on over 1,500 separate SEC filings and over 500 different companies.
Truth Social Picks Semple, Marchal and Cooper LLP
In something of a departure from the expected, the SEC did not actually take the opportunity to call out Truth Social over its use of Borgers. Instead, things went about as rationally as you’d expect, with Truth Social throwing out Borgers in favor of Semple, Marchal and Cooper LLP. Interestingly, when asked, Truth Social didn’t respond to questions from the press asking if the new guys’ first task would be to go over the work done by the old guys to see if there’s anything amiss therein.
Is DJT Stock a Good Buy Right Now?
Turning to Wall Street, there remain no analysts taking a perspective on DJT stock, so we look to the last five days of trading instead. Indeed, there’s been a pretty significant reversal, as DJT stock is down 7.96% in the period. Interestingly, for the last four of those days, it’s up overall, but it fell substantially back around May 1, and that basically tainted the pool in terms of average movement.
