Why Was BF Borgers Penalized by CPA Ontario?

CPA Ontario, Canada’s regulatory body for Chartered Professional Accountants, is taking legal action against BF Borgers CPA PC and Ben Borgers from Lakewood, Colorado, for allegedly violating the Chartered Professional Accountants of Ontario Act, 2017, and the Public Accounting Act, 2004. This enforcement underscores CPA Ontario, Canada’s dedication to maintaining professional integrity, reminding accountants that compliance with standards is essential, regardless of their location. 

A Rapid Rise and Costly Fall of BF Borgers 

Once one of the largest audit firms in the US with a Gross Revenue of Over $1 Million, BF Borgers CPA PC built its reputation by catering to smaller reporting companies with low audit fees. The firm grew rapidly, expanding from 80 clients in 2019 to 173 by January 2024, with over 110 public company audits in 2023 alone. But this success was soon marred by significant legal troubles. 

In 2024, the SEC charged BF Borgers and its owner, Benjamin F. Borgers, with massive fraud involving over 1,500 SEC filings from January 2021 through June 2023. The firm was accused of deliberately violating Public Company Accounting Oversight Board (PCAOB) standards, fabricating audit documentation, and falsely claiming compliance. To settle these charges, BF Borgers paid $12 million in penalties, with Borgers personally paying an additional $2 million. Both were permanently banned from practicing before the SEC. 

So, what was the matter here? 

Borgers and the firm admitted that they carried out public accounting work in Ontario, including auditing a company that reports to shareholders, without being registered with CPA Ontario or having a Public Accounting License in Ontario. 

Since CPA Ontario oversees and regulates CPAs and accounting firms in Ontario, it took the matter into its own hands when BF Borgers failed to register or obtain a license. Interestingly, CPA Ontario's community includes over 100,000 CPAs and 20,000 students in Ontario, yet this was overlooked by the decision-makers at BF Borgers.

Janet Gillies, CPA, CA, executive vice-president of Regulatory and Standards at CPA Ontario said, “We're committed to taking action against accounting firms and CPAs that don’t meet our practice requirements in Ontario, in line with our duty to protect the public and maintain the high standards of the CPA profession.”  

“When firms and CPAs operate without proper registration and licensing, they avoid crucial regulatory oversight, which weakens public trust and protection in public accounting.” 

Fines and Probation for Borgers and Firm 

The Ontario Court of Justice has ordered the firm and Ben Borgers to pay a total of $50,000 in fines to the Government of Ontario, plus $15,000 to CPA Ontario to cover the investigation and prosecution costs. The court also placed both the firm and Borgers on probation for two years. BF Borgers CPA PC and Ben Borgers are still not authorized or licensed to practice public accounting in Ontario. 

Learnings for Professionals  

The legal action taken by CPA Ontario against BF Borgers CPA PC and Ben Borgers will serve as a reminder for professionals in the accounting field.  

Here are the key lessons that can be learned from this case:  

1. Compliance is Non-Negotiable: One of the main takeaways from this situation is the importance of adhering to regulatory requirements. Borgers and his firm performed public accounting work in Ontario without the proper registration and licensing, which led to legal action. Professionals must ensure they are fully compliant with all relevant regulations and licensing requirements before offering their services. This is not only a legal obligation but also a professional one.
2. The Importance of Transparency: Operating without the necessary licenses and registrations not only violates legal standards but also undermines the trust placed in the accounting profession. Janet Gillies of CPA Ontario emphasized that unregistered and unlicensed firms bypass critical regulatory oversight, which is essential for maintaining public confidence. Upholding integrity and transparency is vital for building and sustaining trust in any professional field. 
3. Consequences of Non-Compliance: The penalties faced by BF Borgers and his firm, including substantial fines and probation, highlight the serious consequences of ignoring regulatory obligations. Legal actions can damage a professional’s reputation, lead to financial penalties, and restrict the ability to practice. These outcomes can have long-lasting effects on both the individuals and firms involved. 
4. Value of Regulatory Bodies: Regulatory organizations like CPA Ontario play a crucial role in upholding standards within the profession. They are responsible for ensuring that accountants and firms adhere to ethical practices and maintain public trust. The proactive stance taken by CPA Ontario in this case demonstrates its commitment to protecting the public and maintaining the integrity of the accounting profession. 
5. Public Trust and Accountability: Ultimately, accounting professionals are responsible for maintaining public trust. Operating without proper licenses and oversight erodes that trust. By ensuring compliance and adhering to ethical standards, professionals not only protect themselves from legal repercussions but also contribute to the integrity and reliability of the accounting profession as a whole. 

Professionals in the accounting field can learn from the mistakes made by BF Borgers CPA PC and Ben Borgers by prioritizing compliance, integrity, and continuous learning. By doing so, they help uphold the standards of the profession and ensure that public trust remains strong. Stay tuned for more updates, and don’t forget to subscribe to our weekly newsletter.