The AICPA filed a lawsuit on Tuesday seeking to bar the Federal Trade Commission from applying its so-called Red Flags Rule to CPAs. The Institute says the rule, which is designed to help prevent identity theft, would “impose onerous and unnecessary requirements on AICPA members.”
The lawsuit, filed in U.S. District Court for the District of Columbia, alleges that the FTC is exceeding its congressionally granted powers under the Fair and Accurate Credit Transactions Act of 2003 by seeking to apply the rule to accountants engaged in the practice of public accountancy.
“We do not believe that there is any reasonably foreseeable risk of identity theft when CPA clients are billed for services rendered,” AICPA President and CEO Barry Melancon said in a press release. He added, “CPAs are personally acquainted with their clients and already adhere to strict privacy requirements governing identifying information.”