Certified public accountants (CPAs) are highly regulated professionals, and you require a practice license from the California Board of Accountancy (CBA) if you wish to launch your career as a public accountant. Once you secure your practice license as a CPA, you can offer your services legally and earn an income to care for yourself and your loved ones.
Unfortunately, the nature of your duties as a CPA can put you at risk of administrative complaints and criminal allegations, which could affect your practice license status. Depending on the seriousness of your offense, the board’s CPA disciplinary actions could range from a simple fine or citation to severe and life-altering punishment like revocation or suspension of your practice license.
However, luckily, you do not have to face the board’s investigators and the administrative law judge (ALJ) alone. Our competent attorneys at San Francisco License Attorney can dedicate ample time to understanding the specifics and circumstances of your unique case and prepare a result-oriented legal defense that can help you secure a favorable outcome.
A Look at a CPA’s Scope of Work
Keeping their house in order is a priority for every business or company, and many understand the importance of working with a CPA to manage their budgets, taxes, and other financial paperwork. Businesses and companies of all sizes rely on your services as a CPA on a routine basis to stay legally compliant and fully mindful of their financial decisions.
Your services help them generate more revenue and increase their client base. While it takes several years of education, training, and financial costs to become a licensed CPA, it takes a minor complaint about your practice or conduct to lose your license.
The nature of the work exposes you to a variety of violations, ranging from minor administrative infractions to more serious criminal offenses, which could attract jail time and hefty fines after conviction. Other times, your employer or supervisor could misinterpret a minor error or wrongdoing with no ill intent, leading to allegations of misconduct.
If you find yourself in this situation, understanding what you should do and not do is key. During these difficult times, the assistance of a competent and reputable attorney may prove invaluable. Engaging with a knowledgeable attorney not only provides you with a robust defense strategy but also equips you with helpful insights into the regulatory environment that governs your profession.
This proactive approach can help mitigate risks and ensure you remain compliant with the CBA’s regulations and requirements as your case progresses through the disciplinary process.
The Mission of the California Board of Accountancy
As mentioned in the previous sentence, the CBA is the government agency that is responsible for licensing qualified CPAs and regulating their practices. Here are four primary types of practice the CBA provides:
- Accounting cooperation
- Accounting partnership
- Accounting firm
- CPA
The CBA issues the first three licenses to businesses, companies, and multiple accountants, and the final one to an individual who meets all of the eligibility requirements.
Unlike what many licensed CPAs believe, the CBA’s primary mission is to protect all consumers and the general public from potential financial harm while ensuring that this industry operates to the highest professional standards.
To accomplish this noble mission, the CBA limits the issuance of practice licenses to companies and individuals it deems competent, trustworthy, and more likely to act in the public’s best interests.
Common Crimes that Could Put CPA License at Risk of Suspension or Revocation
A criminal conviction is one of the most serious issues you should worry about as a licensed CPA, especially if the offense is related to your duties and qualifications. A conviction for any of the following crimes could jeopardize your CPA license:
Embezzlement
You commit an embezzlement offense when you illegally take property or money that someone has entrusted to you. To secure an embezzlement charge conviction against you under PC 503, the prosecutor must prove the following:
- A property owner entrusted you with his/her property
- The person did that because he/she trusted you with it
- You fraudulently used or converted the property for personal financial gain
- When you did that, you had the criminal intent of depriving the owner of his/her property and its value
In addition to the possible lengthy jail time and substantial fines, a PC 305 violation conviction can also attract other detrimental consequences, including the suspension or revocation of your CPA license.
Money Laundering
Another crime that can make the CBA investigate you is money laundering. You commit a money laundering offense under PC 186.10 when you channel money obtained from a criminal or illegal activity into a bank account or any other legitimate use, like buying a house to make money untraceable.
Money laundering is a wobbler offense, meaning the prosecutor can file the charge as a felony or misdemeanor, depending on the facts of your unique case. A misdemeanor conviction will carry a maximum jail term of up to one year, while a felony will carry a maximum jail term of up to four years.
Additionally, the court clerk will report your conviction to your licensing board, which may result in suspension or more severe disciplinary action for your CPA license.
Forgery
PC 470 defines the crime of forgery and the penalties you could face after conviction at trial. According to this statute, it is unlawful to falsify someone’s signature, forge a seal, or counterfeit certain documents, including bonds and checks, with the intent to commit a fraudulent act.
Like money laundering, forgery is also a wobbler offense, meaning you could face misdemeanor or felony penalties after conviction.
Check Fraud
According to PC 476, it is a criminal offense to utter, pass, or publish a fraudulent or forged check with the intent to secure something of value. For example, you could face a PC 476 charge when you use a stolen check or erase information on a check. A conviction for a check fraud offense under 476 could result in misdemeanor or felony penalties because it is a wobbler.
The rule of thumb is to consult a seasoned attorney as soon as possible if you or a loved one is under arrest as a suspect in any of the above crimes. Even when the court clerk fails to notify the board of your conviction, chances are you will have to when renewing your license.
If you have a conviction record for any of the above grave crimes, the CBA may revoke your license or refuse to renew it, significantly affecting your source of income. However, when you let a skilled attorney intervene early in your case, the board may dismiss your case or award a lighter disciplinary action that does not involve losing your professional license.
Other Violations That Could Attract the CBA’s Disciplinary Actions
In addition to criminal offenses, allegations of professional misconduct and violations of the board’s rules may jeopardize your CPA practice license. As a licensed public accountant, knowing which acts can result in the board’s disciplinary actions is vital to avoid making any mistake that could put your career in jeopardy.
Most acts and behaviors that could make the CBA launch an investigation against you and your practice involve the following:
- Incompetency, ordinary negligence, or gross negligence
- Unprofessional conduct
- Breach of financial or fiduciary duty
- Aiding or abetting an offense
- Prating without a legally acquired license
- Failing to adhere to the required professional standards
- Use of pair referral systems
- Sexual or physical assault of clients
If your misconduct or violation involves negligence, your licensing board will also file a civil lawsuit against you, meaning you are likely to pay damages if they win. Therefore, you should treat any CBA complaint or allegation seriously and take proactive approaches to help you secure a favorable outcome.
Possible Disciplinary Actions You Could Face
After investigation of the complaint filed against you, the CBA could decide to dismiss the case due to lack of substantial evidence or issue non-disciplinary punishment, including fines and citations. However, in serious cases with substantial evidence against you, the board will schedule your case for an administrative hearing.
During this hearing, a judge will determine whether allegations filed against you are true based on the available evidence. Like a civil court proceeding, during this hearing, the judge will allow your attorney to do the following:
- Cross-examine witness
- Present evidence
- Parent expert testimony
- Parent eyewitness testimony
When the board wins the case, meaning all the allegations filed against you are true, you may face any of the following possible disciplinary actions:
- License revocation
- Public reproval
- License suspension
- A stay of revocation and a probation
- A citation and a fine
The specific disciplinary action the judge will recommend to the CBA will depend on the seriousness and facts of your unique case. The higher the financial loss your client incurred, the more serious your disciplinary action will be. Even the least serious disciplinary measure, like public reproval, could significantly impact your reputation because even your potential employers will know about the case.
Practical Legal Defenses for Challenging CBAs Complaints
Once you contact an attorney, he/she will evaluate your case to know which evidence will work in your favor. Some of the common and viable legal defenses your attorney could assert during the administrative hearing to help you secure a desirable outcome include:
The Evidence Presented is Insufficient
The evidence that the production team or board officers present at the administrative hearing must be convincing beyond a reasonable doubt. If your attorney can provide evidence that shows loopholes or weaknesses in the prosecution team’s evidence against you, the judge will likely dismiss your case or order a lighter disciplinary action.
Your Decisions Were Due to a Mistake of Facts
It is possible that your decisions were the result of an honest mistake or misunderstanding. However, the board will not understand that unless provided with evidence to prove it. A seasoned attorney will know which evidence will work to advantage to secure a favorable outcome.
You are Factually Innocent
When your attorney argues that you are factually innocent, he/she means that you did not participate in or commit the alleged violation. Witness testimonies and surveillance videos are among the evidence that could help support this legal defense and secure a favorable result.
The Patient Did Not Suffer any Harm or Incur Financial Loss
While this defense may not convince the judge to dismiss your case, it could work in your favor to secure a lighter disciplinary action.
You are a Victim of False Accusations
If you had a disagreement or misunderstanding with a colleague in your workplace, he/she could file a false accusation against you with your licensing board. Without a dedicated attorney to persuasively challenge these allegations, you could face disciplinary action for an offense you did not commit.
Frequently Asked Questions by CPAs
If you have received a board notice of investigation, it is normal to panic, but you have options. Below are common questions that most CPAs ask when facing complaints that could jeopardize their licenses:
- What Should I Do After Receiving the CBA’s Notice of Investigation?
The CBA notice of investigation lets you know of the complaints filed against you and gives you a chance to file a response. Once you receive this notification, your first step should be to contact an attorney. Your attorney can help you prepare and file your defense on time to secure a desirable outcome.
- Can the CBA Reinstate Your Practice License After Revocation?
Fortunately, the revocation of your practice license as a public accountant does not necessarily mean that your career is over. The CBA may allow you to file a reinstatement petition after a certain period, provided you present adequate evidence showing why you deserve to keep the license.
Find a Professional License Defense Attorney Near Me
Allegations of professional misconduct or criminal convictions do not always have to result in revocation or suspension of your CPA license. Our credible attorneys at San Francisco License Attorney can intervene and help you prepare a legal defense to challenge the CBAs’ complaints to secure the best possible outcome. Call us at (415) 707-6383 to schedule your first consultation with us today.
