June 2000

The NYSSCPA offers assistance with members' questions on ethics and regulation. Inquiries address a variety of topics such as:

Confidential Client Information

The FBI is investigating a former client of mine. An FBI agent has asked to sit down with me to discuss this client. Do I have a confidentiality problem? What should I do?

You cannot divulge confidential client information without the client's specific consent or without a validly issued and enforceable subpoena or summons. You should explain this to the FBI agent.

Fee for Referring a Client

We are an HMO. We would like to get CPAs to refer their clients who are over 65 years of age to us. We will pay the CPAs $150 for each referral. Is this allowed?

A CPA cannot refer an attest client for a fee. If the client is not an attest client, the CPA would have to determine whether or not the services you are providing are appropriate for the client. The CPA would have to disclose to the client in writing that he or she is receiving a fee for the referral.

Use of "& Co." in Firm Name

Our professional corporation has two shareholders. Can we use both names with "& Co." in our firm name?

The professional corporation and professional partnership regulations are the same on this issue. You must have at least one more shareholder or partner in the firm than names in the firm name to use "& Company" or "& Co." For example, Jones, Jones & Co. would have to have at least three shareholders or partners (owners).

Records Retention Agency

May a member use a records retention agency to store his or her clients' records, working papers, and so forth?

There is no objection to the use of such a records center. However, responsibility for preserving the confidential nature of the records rests with the member.

Revealing Clients' Names

May a member in public practice disclose the name of a client for whom the member or the member's firm performed professional services?

Rule 301 permits a member to disclose a client's name, whether publicly or privately owned, without the client's specific consent, unless the disclosure of the client's name constitutes the release of confidential information. For example, if a member's practice is limited to bankruptcy matters, the disclosure of a client's name could be confidential client information. *

Members with ethics and regulation inquiries shold contact Ann E. Spaulding at (212)719-8348, (800) 633-6320, or aspaulding@nysscpa.org. For a written response, direct correspondence to the Professional Ethics Committee, NYSSCPA, 530 Fifth Avenue, New York, NY 10036-5101.