How to respond to subpoenas

CPAs in receipt of a subpoena should consider the information in the client files, the recent communications with the client or any parties involved, and then contact their professional liability risk adviser or attorney before responding to the subpoena. CAMICO provides this consultation for our policyholders.

The following Q&A focuses on understanding the nature of subpoenas and how CPA firms can minimize their professional liability exposures when responding to them.

How to respond to subpoenas

What is a subpoena?

A subpoena is usually a formal request for documents and/or appearance, typically requested by an attorney in the course of litigation, or by a government agency in the course of a criminal or civil investigation.

What should I do when I receive a subpoena?

Contact your professional liability risk adviser or attorney before responding to the subpoena. In evaluating the appropriate course of action for you to take, your adviser may consider the following information:
  • What is the underlying litigation about? Do you have direct or other knowledge about what the issues are in the litigation?
  • What is the subpoena asking you to do? Is it requesting that you provide testimony, documents, or both? Does the subpoena excuse you from testifying if you provide the documents in advance?
  • Are you in possession of the information listed? Review the subpoena and consider whether your firm is in possession of the information. If the information is confidential, such as tax documents, it may be subject to claims of privilege by the client and/or an accountant-client privilege.
  • Does the subpoena provide a deadline for complying? If the deadline is quickly approaching, or if the subpoenaing party did not provide sufficient time to comply, have you received any communications to suggest the opposing party will grant an extension of time?
  • What communications have you had with your client? Have you had any contact with your client, the attorneys on the case, or the governmental agency? Does that contact suggest whether you are a target or merely a person in possession of information? Is the client taking specific measures to formally object to the subpoena?

Why am I receiving this subpoena?

Typically, an attorney or other party will issue a subpoena because he or she believes you are in possession of information and documents that will establish facts that are relevant to the underlying case. However, sometimes a subpoena may indicate you are a target in the underlying case by seeking information that could implicate you as possibly liable for the matter being investigated or litigated.

Am I required to comply with a subpoena? Is this subpoena a court order?

If you have received a subpoena that is signed by a judge or from the government, you must comply. Government subpoenas generally must be complied with even without client consent or a court order.

However, most subpoenas are pre-printed forms that attorneys or other parties fill out to request information. In these cases, accountants are bound by a number of rules and regulations that are intended to protect clients, including Internal Revenue Code section 7216. Under certain circumstances, these rules and regulations prohibit the accountant from complying with the subpoena, unless the accountant has undertaken specific measures to protect client confidentiality.

Again, contact your risk adviser regarding all subpoenas to evaluate the underlying litigation and the obligation to comply.

Should I report this subpoena to my professional liability agent or carrier?

Yes, regardless of how much or how little information you may have pertaining to the client or former client, it is always important to promptly report the matter.

The information provided is a general overview and not intended to be a complete description of all applicable terms and conditions of coverage. Actual coverages and risk management services and resources may vary and are subject to policy provisions as issued. Coverage and risk management services may vary and are provided by CAMICO and/or through its partners and subsidiaries.

Copyright © CAMICO. All rights reserved.

Share this post

Leave a comment

Filtered HTML

  • Web page addresses and e-mail addresses turn into links automatically.
  • Allowed HTML tags: <a> <em> <strong> <cite> <blockquote> <code> <ul> <ol> <li> <dl> <dt> <dd>
  • Lines and paragraphs break automatically.

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

Latest Articles

  • 15 Jun

    How to respond to subpoenas

    CPAs in receipt of a subpoena should consider the information in the client files, the recent communications with the client or any parties involved, and then contact their professional liability risk adviser or attorney before responding to the subpoena. CAMICO provides this consultation ... read more

  • 06 May

    Six Risk Management Mistakes CPA Firms Make

    Managing CPA liability risk exposures is a complex process, and it's easy to underestimate the potential for risk along the way. The following six mistakes can be avoided by being aware and taking the right steps.

    1. Not discussing questions about the insurance application... read more

  • 23 Apr

    Top 5 Ways a CPA Can Invite a Malpractice Lawsuit

    After more than 31 years of malpractice claims experience, CAMICO has developed a wealth of information about what causes disputes between CPAs and their clients, what leads to litigation, and how to avoid or minimize the damages from such conflicts. There are basic risk management steps t... read more

  • 15 Mar

    Tax Tip – Documenting Advice and Decisions

    All significant client meetings should be documented with a written description of the subjects discussed at the meeting. This will help ensure that both you and the client are proceeding with the same expectations and assumptions.

      ... read more