ALJDEC decisions subject to certification as final

14F-2013.102B-ACY · State Board of Accountancy · 2014-06-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 13, 2014 APPEARANCES: Respondent Richard M. Streetman did not appear. The Arizona State Board of Accountancy was represented by Assistant Attorney General Michael D. Raine. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________ Based upon the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: FINDINGS OF FACT 1. The Arizona State Board of Accountancy (Board) is the authority for regulating the profession of certified public accountants in the State of Arizona. 2. Richard M. Streetman (Respondent) is the holder of Certified Public Accountant Certificate No. 3654-E issued by the Board. The certificate enables Respondent to practice as a certified public accountant in Arizona. 3. On May 15, 2013, the Board issued a Complaint and Notice of Hearing (2013 Complaint) to Respondent for alleged violations of the Board’s statutes and rules, which set a hearing date of July 18, 2013. The 2013 Complaint was sent to Respondent via certified mail. 4. Respondent did not appear at the July 18, 2013 hearing before the Office of Administrative Hearings. The hearing proceeded in Respondent’s absence, and the Board presented evidence supporting the imposition of discipline against Respondent’s certificate. 5. On August 7, 2013, the Administrative Law Judge issued a Decision with Findings of Facts, Conclusions of Law, and Recommended Order (ALJ Decision). The ALJ Decision determined that the Board properly served the 2013 Complaint on Respondent. Further, the ALJ Decision found that Respondent was required to complete 80 hours of continuing professional education (CPE) during the two-year period immediately preceding Respondent’s 2013 registration renewal and that Respondent failed to do so. Exhibit 1. 6. The ALJ Decision recommended that the Board suspend Respondent’s certificate for a period of 12 months or until Respondent submitted proof that he had completed the CPE that the Board required for the 2013 registration renewal, whichever occurred earlier, and that Respondent reimburse the Board its costs of investigation within 12 months. Exhibit 1. 7. On September 4, 2013, the Board sent Respondent a letter notifying him that the Board would review the ALJ Decision at its September 16, 2013 meeting. Exhibit 2. The Board enclosed a copy of the ALJ Decision with the letter. 8. On September 16, 2013, the Board reviewed the ALJ Decision and voted to adopt the Findings of Fact, Conclusions of Law, and Recommended Order. Exhibit 3. The Board issued its final agency decision on September 19, 2013. 9. On January 29, 2014, Board staff sent Respondent a compliance affidavit by certified mail to his address of record. The letter accompanying the Affidavit of Compliance provided as follows: In order to assist the Accountancy Board in its monitoring of Orders, staff has been directed to prepare affidavits, such as the one enclosed, to be sent to the registrant periodically for the purpose of determining compliance. You are hereby requested to respond by completing and submitting the enclosed affidavit within thirty days from the date of this letter. Please be advised that your failure to timely respond and/or submit the requested material may be considered a violation of A.A.C. R4-1- 455.03(F), and grounds for disciplinary action against your certificate pursuant to A.R.S. § 32-741(A)(9) and (15).

Exhibit 4.

10. Respondent signed for the certified mailing on February 10, 2014. Exhibit 4. 11. A response to the Board’s letter was due by February 28, 2014. 12. By letter dated March 12, 2014, Board staff informed Respondent that the Board would review his failure to respond to the Board’s request for the compliance affidavit at its March 19, 2014 Board meeting. The letter was sent to Respondent by regular mail. Exhibit 5. 13. On March 19, 2014, the Board reviewed Respondent’s file and voted to issue a complaint and notice of hearing for discipline against Respondent for his failure to timely respond to the Board. Exhibit 6. 14. On April 2, 2014, the Board issued a Complaint and Notice of Public Hearing, setting a hearing before the Office of Administrative Hearings (OAH) at 8:00 a.m. on May 13, 2014. The Board mailed a copy of the Complaint and Notice of Public Hearing at his address of record with the Board. 15. A hearing was held at the OAH on May 13, 2014. The Board submitted eight exhibits and presented the testimony of Deputy Director Jim Dubé to establish the facts set forth above. 16. Respondent did not request to appear telephonically at the duly noticed hearing and did not request that the hearing be continued. Although the start of the hearing was delayed 20 minutes to allow Respondent additional travel time, he did not appear, personally or through an attorney, and did not contact the OAH to request that the start of the hearing be further delayed. Consequently, Respondent did not present any evidence to defend his CPA certificate. 17. As of the date of the hearing, Respondent had not submitted a completed compliance affidavit to the Board. CONCLUSIONS OF LAW 1. The Complaint and Notice of Public Hearing that the Board mailed to Respondent at his address of record was appropriate, and Respondent is deemed to have received notice of the hearing. See A.R.S. § 41- 1092.04; A.R.S. § 41-1061(A). 2. The Board has personal and subject-matter jurisdiction over Respondent and this complaint pursuant to A.R.S. §§ 32-701 et seq. and A.A.C. R4- 1-101 et seq. 3. Pursuant to A.R.S. § 41-1092.07(G)(2) and A.A.C. R2-19-119(B), the Board has the burden of proof in this matter. The standard of proof is by a preponderance of the evidence. See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). 4. Under A.R.S. § 32-741(A),[1] after notice and opportunity for hearing, the Board may revoke or suspend, or may take additional disciplinary action, as defined by A.R.S. § 32-701(10),[2] against Respondent’s CPA certificate. 5. Pursuant to A.A.C. R4-1-455.03(F), registrants, when requested, are required to respond to communications from the Board within 30 days from the mailing of such communications by registered or certified mail. 6. Respondent’s failure to respond to the Board’s request to complete and return a compliance affidavit constitutes a violation of A.R.S. § 32- 741(A)(15)[3] and A.R.S. § 32-741(A)(9)[4], specifically A.A.C. R4-1- 455.03(F),[5] as charged in the Complaint. 7. Respondent’s conduct warrants disciplinary action against Certificate No. 3654-E, pursuant to A.R.S. § 32-741(A) and A.R.S. § 32-701(6). RECOMMENDED ORDER Respondent’s Certificate No. 3654-E shall be revoked on the effective date of the Order entered in ASBA File No. 2013.102B/OAH Docket No. 14F- 2013.102B-ACY. In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be 40 days from the date of that certification. Done this day, June 2, 2014.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

Monica L. Petersen, Executive Director Arizona State Board of Accountancy ----------------------- [1] A.R.S. § 32-741(A) provides that “[a]fter notice and an opportunity for a hearing, the board may revoke or suspend any certificate granted under this chapter and may take disciplinary action concerning the holder of any certificate” for certain enumerated causes. [2] A.R.S. § 32-701(10) defines “disciplinary action” as follows:

"Disciplinary action" means any other regulatory sanctions imposed by the board in combination with, or as an alternative to, revocation or suspension of a certificate or registration, including the imposition of: (a) An administrative penalty in an amount not to exceed two thousand dollars for each violation of this chapter or rules adopted pursuant to this chapter. (b) Restrictions on the scope of the registrant's accounting practice, including, without limitation, restriction of audit or attest function practice, restriction of tax practice or restriction of consulting services. (c) Pre-issuance and post-issuance peer review. (d) Professional education requirements. (e) A decree of censure. (f) Probation requirements best adapted to protect the public welfare. (g) Reimbursement of the board's costs of investigations and proceedings initiated under this chapter. (h) A requirement for restitution payments to accounting services clients or to other persons suffering economic loss resulting from violations of this chapter or rules adopted pursuant to this chapter.

[3] A.R.S. § 32-741(A)(15) provides the Board may revoke or suspend any certificate for “[f]ailing to respond in writing or furnish information in a timely manner to the board or its designated agent, if the information is legally requested by the board and is in the registrant's possession or control.” [4] A.R.S. § 32-741(A)(15) provides the Board may revoke or suspend any certificate for “[v]iolation of any decision, order or rule issued or adopted by the board.” [5] A.A.C. R4-1-455.03(F) provides “Communications: When requested, certified public accountants or public accountants shall respond to communications from the Board within 30 days of the mailing of such communications by registered or certified mail.”

-----------------------

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826