How CPA Firms Should Handle Subpoenas 

Subpoenas are a stressful matter for CPA firms, as they raise questions about confidentiality, legal obligations, and liability. The key is to know how to respond the right way to protect your firm and your clients. 

What is a Subpoena? 

A subpoena is a formal request for the production of documents or testimony. Subpoenas are often sent by an attorney involved in a lawsuit or a government agency investigating a legal matter.

Steps to Take 

If you receive a subpoena, the ideal response is not to respond to it right away. Instead: 

• Review all client files and recent communications 
• Get in touch with your professional liability risk adviser or attorney. 
• Discuss the details of what the subpoena is asking for.  

There would be a few questions your trusted risk adviser would help you evaluate, such as: 

• What is the case about? Do you have any direct or indirect knowledge? 
• Are you requested to testify, provide documents, or both? 
• Is it possible for you to avoid testifying if you provide documents in advance? 
• Do you have the documents they’ve asked for? 
• Are the requested documents confidential (like tax returns) and are protected under the accountant-client privilege?  
• What’s the deadline? Will you need more time, and has anyone offered an extension? 
• Have you spoken to the respective client or any attorneys involved? 
• Are you just a witness, or are you potentially under investigation yourself? 
• Is the client willing/planning to fight the subpoena? 

Why You Were Subpoenaed 

There can be various reasons behind you receiving a subpoena. In most cases, someone must have assumed that your firm has the documents or knowledge that could help them with their case. However, in some cases, the subpoena could also be looking into whether the CPA did something wrong. Which is why it’s important to approach every subpoena seriously.  

Do You Have to Comply? 

This entirely depends on a few factors, which are: 

• If you receive court-ordered subpoenas (signed by a judge) and subpoenas from government agencies, those usually require compliance, with or without client consent.  
• Subpoenas issued by attorneys, which are common in civil cases, are often just standardized forms. In such cases, it is crucial for CPAs to follow confidentiality rules, including Internal Revenue Code Section 7216, which generally prohibits any sort of disclosure without the client’s written consent.  

It is vital for you to consult with your risk adviser before taking any action. 

Should a Subpoena Be Reported to Your Insurance Carrier?

Absolutely! This is crucial even if you think you only play a minor role. Therefore, make sure to inform your professional liability insurance carrier right away. 

Subpoenas can be much more complex than they initially appear. Even if your role seems minor, your response can carry serious legal and professional consequences. Your priority must always be client confidentiality, involving legal counsel, and informing your insurance provider right on time. Acting right can help protect your firm, your clients, and your reputation.  

Shayne Bevilacqua, MBA, TRA, is the Principal and Owner of Professional Liability Insurance Group (PLIG) and Bevilacqua Insurance Group (BIG). As a Trusted Risk Advisor with decades of experience in professional liability, Shayne regularly guides firms through complex issues like subpoenas, claims, and risk exposure. His hands-on approach and access to top-rated carriers ensure clients receive informed, proactive protection tailored to their profession.  

Get in touch for more information at (877) PLIG – 123.