AICPA Files Suit Challenging Identity Theft Rule

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.”



News quiz: College debt, stolen identities, and retirement planning

See how much you know about these developments and others in the Journal of Accountancy news quiz.


Preventing and detecting fraud at not-for-profits

Organizations in all industries must deal with the potential for fraud to occur, and design controls to prevent and detect it. Environment, policies, and controls can help organizations steer clear of problems.


The dangers of dabbling

To meet evolving marketplace needs, CPAs often look to diversify their service offerings. Firms can mitigate the risk of experiencing competency-related professional liability claims by implementing these basic steps.