The American Institute of CPAs lauded the introduction of legislation this week that would amend the privacy provision of the Gramm-Leach-Bliley Act applicable to CPAs.
The Privacy Protection Act of 2005 (H.R. 2387) was introduced Tuesday by Representatives Mark Kennedy, R-Minn., and Collin Peterson, D-Minn.
"The American Institute of CPAs is pleased Congress has taken this important step to support legislation that would exempt CPAs from a redundant requirement," AICPA chief executive Barry Melancon said. "By relieving a substantial unnecessary regulatory burden on CPAs, and especially on sole practitioners and small firms, small businesses can realize the cost benefit."
The purpose of GLB was to protect the confidentiality of non-public personal financial information by requiring disclosure of how that information may be shared, and allowing the client to opt-out of any information sharing. However, since CPAs have historically been legally required to maintain the privacy of all non-public financial information provided to them by a client unless the client gives express consent for any sharing of information, the AICPA says the rules created by GLB have added "substantial and unnecessary regulatory burdens."
CPAs are subject to mandatory rules of confidentiality and risk losing their ability to practice and possibly going to jail if they disclose non-public personal financial information without the express consent of their client. According to the institute, the rules governing CPAs give clients greater privacy protection than provided by GLB because clients have to opt-in for any sharing of the non-public financial information.
