H.R. 3126, the “Consumer Financial Protection Agency Act"
|
|
|
Date: August 13, 2009
To: Federal Key Persons for House Financial Services Committee
From: Mark Peterson, Vice President, Congressional and Political Affairs
Subject: Immediate Action Needed – Please Call Your Representative on the House Financial Services Committee to express your concern that the proposed Consumer Financial Protection Agency would regulate CPAs
Please call your Representative during the August Congressional recess to express your concerns about the scope of H.R. 3126 that would regulate CPAs when they provide financial services to clients.
Key Person Action Needed Immediately
Please contact your Member of Congress on the House Financial Services Committee during August at two places – both in the district and in his or her Washington office – to express your concerns about the redundant regulations that H.R. 3126 would impose on CPAs who provide financial services to consumers.
(SUGGESTED TALKING POINTS ARE LISTED AT THE END OF THIS ALERT)
Brief Background
H.R. 3126, the “Consumer Financial Protection Agency Act”, was introduced on July 9 by House Financial Services Committee Chairman Barney Frank as part of the broad financial restructuring underway to protect consumers who purchase financial products from bank and non-bank financial institutions. The bill would establish a new Consumer Financial Protection Agency and would consolidate the enforcement of federal financial consumer protection laws into that agency.
As part of its broad reach, H.R. 3126 would also give regulatory power to the Consumer Financial Protection Agency (CFPA) that would cover financial services and products provided by a CPA to an individual, such as tax preparation, tax planning and personal financial planning services and perhaps even the extensive pro bono efforts by CPAs across the country to raise the financial literacy of Americans.
It does not recognize that CPAs are licensed by the state boards of accountancy, operate under strict ethical standards and, with regard to federal tax related services, have to meet the strict regulatory requirements of the Treasury Department and the Internal Revenue Service.
AICPA believes that the provisions in the bill are redundant and would be an unnecessary regulatory burden on CPAs, without providing any increased protection for consumers.
We support the need for stronger consumer protections. The events in the housing and banking industries that triggered the economic crisis demonstrate too well the weaknesses in our regulatory system, as well as serve as proof of the need for consumers to improve their financial literacy skills, which is the aim of the AICPA’s long-standing 360 Degrees of Financial Literacy program.
Status as of August 13, 2009
Chairman Frank has announced that he may hold a hearing(s) and plans to hold a mark up of the bill in September, after Congress returns to Washington.
The August recess creates an opportunity for the accounting profession to contact Members of Congress in their home districts and staff members in Washington to express their concerns about the regulatory reach of the proposed legislation.
If your Representative is holding “town hall” meetings in your district during the next few weeks, you may want to consider attending one of those as well. Town hall meetings are another good opportunity to meet your Member and his or her staff.
Report the Results of Your Calls to the AICPA - Congressional Contact Information Available at www.aicpa.org/advocacy
Emails, telephone calls or faxed letters are the best ways to communicate with Congress.
Go to www.aicpa.org/advocacy to find the phone number, email and fax information for your Representative on the Committee.
Phone calls are the most effective means of contact – ask to speak to the Member’s Chief of Staff, or Legislative Director, if you cannot reach the Member, and ASK FOR A RETURN CALL IF YOU MUST LEAVE A MESSAGE. Calls and emails from constituents are a powerful legislative action tool.
Please let us know about your conversation with your Member, or send us a copy of the letters you send to your Representative.
Knowing the scope of CPAs’ contacts with Representatives on the Committee will help the AICPA Congressional Affairs Team leverage your efforts.
Please send a short summary email to AICPA at congaffairs@aicpa.org about your contact with your Representative.
If you have questions, please contact:
Thank you for your prompt outreach on this important issue. It is likely that the AICPA will call on you, and other Federal key persons, as financial markets re-regulation continues to develop.
__________________________________________________
Suggested Bullet Points for your Conversation:
- I am concerned that H.R. 3126 gives regulatory power to the new Consumer Financial Protection Agency that would cover financial services and products provided by a CPA to individuals.
- As proposed, the new Agency would regulate tax preparation, tax and estate planning and personal financial planning services and perhaps even the extensive pro bono efforts by CPAs across the country to raise the financial literacy of Americans.
- Along with the CPA profession, I support the need for stronger consumer protections. The events in the housing and banking industries that triggered the economic crisis demonstrate too well the weaknesses in our regulatory system and the need for consumers to improve their financial literacy skills, which is the aim of the AICPA’s long-standing 360 Degrees of Financial Literacy program.
- CPAs are licensed by the state boards of accountancy, operate under strict ethical standards and, with regard to federal tax related services, have to meet the strict regulatory requirements of the Treasury Department under Circular 230 and the Internal Revenue Service. The proposed new Consumer Financial Protection Agency doesn’t recognize that this strong oversight already exists.
- It’s important to remember that causes and aggravating actions cited by the Administration and others commenting on our current economic problems do not include the types of financial services traditionally offered by CPAs that would be covered by the bill.
- Subjecting CPAs to the requirements of the bill would do nothing to alleviate the problems being attacked by the bill.
- I believe that the provisions in the bill relating to CPAs who provide services to individuals - where they don’t include selling investment vehicles and loans - and CPAs who are engaged in pro bono financial planning services are redundant and would be an unnecessary regulatory burden on CPAs, without providing any increased protection for consumers.
- I hope you will strongly consider exempting CPAs who provide straightforward, valuable services to Americans from the duplicative regulations included in H.R. 3126
- Thank you for your consideration, and please call on me if I can be of additional service to you.
Cc: State CPA Society Chief Staff Executives
State CPA Society Deputy Chief Staff Executives
State CPA Society Legislative Staff