Legislative / Regulatory

Should CPAs be required to file as “consumer debt counselors”?

Meet Joe We say "NO"!

The bills in the Maryland General Assembly are flowing at this point - over 750 bills in the first three weeks. We just caught this one that we were watching from last year (see our post here).

Last year in the closing week of the General Assembly we caught the Debt Counseling Registration legislation as a bill that would adversely effect CPAs. Based on the definition of "debt counselor" we concluded that CPAs may be forced to register, pay an annual license fee (estimated at $500), and be subject to oversight by the Maryland DLLR Commissioner of Financial Regulation.

We immediately expressed our opposition to this as another layer of unnecessary and onerous regulation of CPAs.

We cited the extensive educational, examination, ethics, and experience (the 4 E's) requirements that are behind the CPA License by the State of Maryland. We also educated the legislators that CPAs are always advising clients (and employers) on debt structure, tax liabilities, etc in the normal course of their business. The bill was dropped and studied over the summer.

Now it is back SB 741 - Commercial Law - Debt Settlement Services introduced in the Senate Finance Committee. The good news is that our voices from last year and CPA day this year seem to have been heard, CPAs are specifically exempted from this legislation as we read it, take a look below:

See page 7 in Senate Bill 741's text where it says the

(1) The following persons when engaged in the regularo course of their businesses and professions:

(III) Certified Public Accountant;

Therefore we can change our opposition to support subject to this exemption remaining in the bill. We will be testifying before the Committee on March 1, 2011 to make sure that the exemption remains in.