Confidentiality and ethical obligation to disclose tax fraud

[tormented1L]

What is the name of your state? Arizona

As an accountant and tax preparer, not a CPA, attorney, or EA, if that accountant knows that a client has previously evaded federal taxes and committed fraud prior to becoming his/her client, does he/she have any ethical duty to report the fraud committed when the taxes were prepared by a previous preparer, or does the confidentiality between accountant and client preclude any reporting of prior actions by former CPA and in turn client?

 

[seniorjudge]

What is the name of your state? Arizona

As an accountant and tax preparer, not a CPA, attorney, or EA, if that accountant knows that a client has previously evaded federal taxes and committed fraud prior to becoming his/her client, does he/she have any ethical duty to report the fraud committed when the taxes were prepared by a previous preparer, or does the confidentiality between accountant and client preclude any reporting of prior actions by former CPA and in turn client?

My guess is that there is no duty of nondisclosure for an accountant because they are not regulated.

 

[abezon]

If you learned of the past fraud while in a preparer-client relationship, you cannot disclose the fraud to anyone. Your only recourse is to refuse to prepare or sign your name to a fraudulent return in the future.