Accountants like to portray themselves as the squeakiest of the clean, motivated by a complete absence of conflicts of interest. That's why a Texas CPA lying to the regulators is news.
Bryan Polozola was supposed to be a routine witness in an SEC inquiry into various hedge funds. But when he denied knowledge of a previous charge of taking $49,000 from a former employer and covering it up, it set off warning bells fast.
After a criminal hearing, Polozola has now confessed to lying to government officials and will be sentenced in March.
The testimony had nothing to do with the hedge funds, but with a CPA on the stand, the SEC evidently wanted to send a strong message.
The case is now riding the SEC home page.
"Truth in testimony is the first principle of a fair and effective enforcement program," warns Robert Khuzami, head of the SEC's enforcement division.
Beyond the blatant lying, the case flies in the face of claims that CPAs are supposed to be held to a "higher than fiduciary" standard because their real duty is to the public and not to their clients.
Surely the public duty includes telling the government the truth, even if it's about an old embarrassment that was settled years ago.
But it seems that nobody's above bending the truth to suit themselves, no matter what certification or designation they have, or what business model they follow.
This is not just a "told you so" item to make fiduciaries feel good about themselves. It's a warning shot.
In a world where even Certified Financial Planner practitioners can do the wrong thing and CPAs lie about their past, honesty is a premium. Not all the bad players will eventually suffer for their lies, but enough do.