Warning over rogue accountancy firms

Chartered Accountants Ireland (CAI) has warned that there are more than 120 accountancy firms operating without any regulatory oversight and a number of them are being run by convicted fraudsters.

The findings emerged from the first industry-wide census of more than 2,000 firms offering accounting advice by the main accountancy bodies.

The CAI warned its research had found that some of the 120 firms identified as not being regulated were managed by people who have no qualifications, have served prison time for fraud or were before the courts on fraud charges.

CAI president Brendan Lenihan said the number of rogue firms in operation was quite worrying. “Quite disturbingly, in a number of rogue cases, the people fronting these unregulated firms have criminal records for fraud or are before the courts. They often give a misleading impression that they have accountancy qualifications.

“This system would not be permitted for any other professionals of which we are aware. Because we have registration of medical personnel, you do not need to ask your surgeon to prove his or her basic qualifications before lifting a scalpel.

“Unfortunately, people can’t assume the existence of a brass plate outside an office is enough evidence of a professional qualification,” he said.

The CAI has for some time drawn attention to a dangerous loophole currently in place which in effect allows anyone to advertise themselves and work as an accountant with impunity, even if they are unqualified, have criminal backgrounds or offer uninsured or substandard services to the public.

“This situation has been allowed to remain for too long, and as a result, too many consumers have suffered financial loss and poor advice. This is clearly not in the public interest and leaves consumers at risk in terms of quality of advice and courses for redress. We call on the Government to act speedily to ensure legislation is in place that protects the consumer.”