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California Criminal Convictions and Accountant Discipline

June 22, 2021

California  Criminal Convictions and Accountant Discipline

Accountants in the state of California risk professional discipline by the California Board of Accountancy (CBA) in the wake of a conviction for a crime that is “substantially related” to the work of accountancy. Depending on how serious your case is, the punishment could range from a simple reprimand to license revocation.

 

In this article, you will learn about criminal convictions and accountant discipline in California.  If, after reading, you have further questions, please feel free to contact us for a consultation.

 

We will cover:

  1. What government agency regulates California accountants?
  2. The 7-year rule: Can I become an accountant in California with a criminal conviction?
  3. What types of criminal convictions bring can result in discipline?
  4. Will I be able to fight for my license?

 

  1. What government agency regulates California accountants?

Under the auspices of the California Department of Consumer Affairs, the California Board of Accountancy regulates accountants in California. The law this Board enforces is California Accountancy Act.  They also implement regulations in keeping with its mission to protect members of the public.

 

  1. The 7-year rule: Can I become an accountant in California with a criminal conviction?

Whether you can apply this rule to your circumstances depends on when the incident occurred, and what crime you were charged with. If your criminal conviction is from more than seven (7) years ago, grounds for denial of an accountancy license generally do not exist as long as you completed all the sentencing terms.

On the other hand, the Accountancy Board can still disqualify applicants for convictions no matter how old the conviction is if it lands in certain categories.  This includes heinous crimes punishable by incarceration in state prison or death, such as sex and drug offenses, felony financial crimes, murder, rape, arson, weapons charges and more.

 

Apart from those, an applicant with a conviction within the past seven years could still be eligible for a license if the offense is not “substantially related” to the qualifications, functions, or duties of being an accountant.

In cases where the Board denies an applicant a license on the basis of criminal history, it will inform the applicant of his/her right to appeal the denial.

 

  1. What types of criminal convictions bring can result in discipline?

Any conviction that can be deemed “substantially related” to the qualifications, functions, or duties of an accountant can bring on Board of Accountancy discipline.  This can include license revocation or suspension, or censure.  In other words, these convictions constitute “unprofessional conduct.”

This “substantially related” requirement is based in statutes as well as in the Constitution.  You have a right to practice your chosen profession that cannot be impeded unless there is a reason that relates to your fitness to practice that profession.

The Board’s Disciplinary Guidelines recommend license revocation as a maximum consequence for being convicted of a felony or “several misdemeanor” offenses.  The minimum penalty for such convictions as per the Guidelines is a period of actual suspension with the potential for probation conditions including restitution, ethics course, community service and/or administrative penalty.

 

The “Substantially Related” Requirement

A conviction that is considered “substantially related” is one that “evidences present or potential unfitness of a certified public accountant or public accountant to perform the functions authorized by his or her certificate or permit in a manner consistent with the public health, safety, or welfare.”  By regulation, the Board specifies that any crime involving dishonesty, fraud or breach of fiduciary responsibility, or any violation of the California Accountancy Act, are included in this definition.

Board newsletters and other enforcement documents have highlighted the following kinds of convictions as infractions that net disciplinary action against California accountants:

  • tax evasion
  • bank fraud
  • carjacking
  • forgery
  • mail fraud
  • grand theft

 

This is not a definitive or exhaustive list.  Rather, we just wanted to provide some examples for your information.

Ultimately, we strongly recommend you consult an attorney if you need to assess whether your particular conviction could potentially raise a red flag in the eyes of the Board of Accountancy or a court to be substantially related to accounting.

 

What is a Conviction According to Board of Accountancy Criteria?

For the purposes of the Board of Accountancy, a conviction is any felony and misdemeanor conviction secured by a guilty plea or verdict, a no contest plea, or a conviction that could later be expunged under California Penal Code Section 1203.4.

The Board can act in response to a conviction when the time for appeal has passed, the judgment of conviction was affirmed on appeal, or an order granting probation is handed down, suspending imposition of sentence.  Nevertheless, the reporting obligations outlined below define convictions more broadly to include initial pleas and sentence pronouncements.

 

What are Reportable Events?

Just as for doctors and lawyers, accountants in California are subject to ongoing reporting obligations in connection with any criminal activity.  According to Bus. & Prof. Code 5063, accountants are obligated notify the Board of Accountancy within 30 days of certain criminal convictions.

The courts in which such convictions have taken place also have reporting obligations.

 

  1. Will I be able to fight for my license?

Indeed, you have options in fighting for your license if you receive an accusation from the Board of Accountancy.  You could negotiate a favorable settlement with the Board.  Additionally, you have the right to a hearing in before an administrative law judge.  In your hearing, you can exercise your right to discovery of relevant evidence to prepare for and you will be able to present evidence and cross-examine witnesses during the proceeding.  Another option is to present key evidence demonstrating that you have been rehabilitated from your crime.

If all else fails and you still lose your permit or certificate, down the line you will be able to petition the Board for reinstatement.

 

Our California Criminal Defense Attorneys Can Assist You.

Are you or a loved one an accountant who has been charged with a crime and you want to hire the best possible attorney for representation?  If so, then we invite you to contact us at Spodek Law Group. We will be glad to provide a free consultation in office or by phone. We have local offices in Los Angeles, San Francisco, the San Fernando Valley, Long Beach, Orange County, Ventura, Riverside,  San Bernardino, Rancho Cucamonga, San Diego, Pasadena, Sacramento, Oakland, San Jose and throughout California.

 

 

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