The accountant who allegedly would not let her clients leave

Friday, 14 October 2022

An accountant is accused of using ‘intimidation’ tactics over small migrant businesspeople who tried to leave her.

Asian migrant small business owners in Auckland and Wellington allege an accountant pursued a campaign of intimidation after they tried to switch accountants.

Actions taken by the accountant allegedly included invoicing clients for costs they didn’t owe, using debt collectors as an intimidation tactic, altering a tax return without permission and making accusations against two accountants her former clients tried to hire to replace her.

One of the accountant’s clients wrote a letter to the professional conduct committee of the Chartered Accountants Association Australia and New Zealand (Caanz) and accused the accountant of “harassing me at midnight and early morning to express her unhappiness”.

”She also said she can end my new appointed accountant’s career if she wanted to.”

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In one case the accountant made a false accusation that the client’s new accountant had been punished for having sex with clients.

The accountant at the centre of the allegations defended herself at the hearing.

Small migrant businesses were involved including a sushi shop and a bakery.

She said the amounts of money involved were not large enough to require the tribunal’s involvement, that it was not clear her clients had properly let her go, that her former clients did owe her money for discounted services and that debt collectors were used as a dispute resolution mechanism rather than a tactic of intimidation.

The defendant also complained about being harassed, including on racial grounds, by staff at Caanz.

The multiple business owners involved and the accountant gave evidence at a hearing before the New Zealand Institute of Chartered Accountants (NZICA) disciplinary tribunal in September.

Identities of the business owners and the defendant are suppressed until the tribunal makes its decision.

Prosecution lawyer Richard Moon said the amounts of money involved were small on one level, but large for the type of businesses involved, which included a bakery and a sushi shop.

“The amounts of money are not always huge, but that’s irrelevant … it doesn’t matter if you’re going to shakedown your clients for $200, as a chartered accountant there isn’t an acceptable number.”

Moon alleged the defendant’s actions followed a similar pattern.

“Once the person decided they don’t want [her] to be their accountant any more out pops a couple of bogus invoices.

“Those are then progressed through various other forms of intimidation whether it be debt collection or disputes tribunal.

“[The defendant] is absolutely right, they’re not for large sums of money in the grand scheme of things, which begs the question why they were being pursued in this manner.”

The hearing took place over five days in Wellington, in front of a panel, including Matthew Casey KC, Andrée Atkinson, John Naylor and Richard Simpson.

Caanz was formed from the merger of the Institute of Chartered Accountants in Australia and NZICA in 2015.

Part of the merger agreement was the requirement NZICA remain in place to regulate accountants in New Zealand.

‘We decide to just pay it’

At the hearing one of the defendant’s former clients explained why they eventually decided to pay the defendant’s invoice even though they disputed whether they were liable for it.

“We decide to just pay it … I’ve been trying to tell her to let us go, but she just keeps coming.”

The client was a bakery that ran into problems when they tried to switch to a different accountant.

There were problems with getting the accountant to hand over their files to the new accountants and the prosecution also alleged the accountant had logged in and changed some tax records without permission when she had long ceased to be employed as her former client’s accountant.

The business owners alleged the communications with the accused accountant also started to get “volatile and vindictive”.

The defendant said their new accountant was not a chartered accountant, was in need of psychiatric treatment and also falsely accused him of having inappropriate sexual relations with clients.

Within the hearing it was alleged that the last allegation had come from a misreading of a decision involving client’s new accountant

A decision involving inappropriate sexual relations had been referenced in the case, but the case had nothing to do with the new accountant.

However, the accusation that the new accountant was not a chartered accountant was true.

Over the course of the hearing it was also accepted that the new accountant had made some false claims within their advertising material about being a chartered accountant.

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The defendant told the tribunal she had raised those concerns because she was concerned for the welfare of her former client.

‘We did not know what to do’

However, she also allegedly continued to invoice her old clients after her contractual relationship with them ended and put debt collectors onto them when they did not pay.

In a letter presented as evidence the client said they were trying to raise money to buy a house when the debt collectors called.

“We became very worried. We thought our application for a mortgage would be refused.

“We did not know what to do. We wrote to the debt collectors and pointed out we did not owe [the accountant] any money … but they have started sending us demands again.”

The accused accountant cross-examined her former client at the tribunal hearing and told him that if they did not accept the bill he could have disputed it.

“I apologise for making you worried with debt collectors … it won’t have an impact on your [credit rating] you just have to say you dispute the bill.”

Her former client replied: “I have told, but they just keep coming because you keep sending invoices to them.”

Tribunal members asked the accountant if debt collection notices could constitute a threat and the accountant replied: “I don’t really think that’s a threat, that’s information.”

“As a professional we need to educate clients.”

Simpson asked if setting debt collectors on a client was really about educating them, or punishing them.

The tribunal was also presented with evidence that a different accountant had faced retaliation because they had tried to help one of the accused accountant’s clients change to a different one.

Moon said the defendant’s behaviour across several clients who spoke before the tribunal showed they were not able to be regulated by the institute.

The defendant said that she had learned some things from the experience and considered some elements of the tribunal’s questioning to be good feedback on her performance that they would take away and learn from.

Casey said the hearing was a serious disciplinary proceeding and not intended as a forum to provide feedback.

The accountant also disputed whether certain actions she took could actually be considered threats against her client, including one where she allegedly threatened to report a client to “New Zealand central government agencies”.

Casey said: “By any reading this is a threat, can you not see it that way?”

“You are making up your answers, and they do not wash with this tribunal.”

The tribunal is likely to make its decision over the next few weeks.

CORRECTION: An earlier version of this story referred to prosecution lawyer Paul Moon; his name is Richard Moon. It also said the September hearing was before Caanz’s disciplinary tribunal, when it was actually the NZICA tribunal. (Amended October 16, 2022, 2.53pm.)