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Bon mots

"You can observe a lot just by watching." Yogi Berra

"We do not distain to borrow wit or wisdom from any man who is capable of lending us either." Henry Fielding, Tom Jones

"In our complex society the accountant's certificate and the lawyer's opinion can be instruments for inflicting pecuniary loss more potent than the chisel or the crowbar." United States v. Benjamin, 328 F.2d 854, 862 (2d Cir. 1964)

CPAs' Summary Affirmance Motion Denied

Kevin Hall, CPA and Rosemary Meyer, CPA, Exchange Act Rel. 57855 (May 23, 2008)


On January 15, 2008 an ALJ dismissed proceedings against these two CPAs (decision here).  The Division of Enforcement appealed that decision.  Hall and Meyer moved for summary affirmance.  The Commission denied the motions.

The Commission will summarily affirm an ALJ's decision only when "no issue raised in the proceedings warrants further consideration."  Here, the Division of Enforcement claims in its appeal that the ALJ misapplied or ignored important GAAS concepts and long standing Commission precedent.  The Commission rarely grants summary affirmance motions as "generally we have an interest in articulating our views . . . ."  Summary affirmance is appropriate only where "it is clear that 'submission of briefs by the parties will not benefit us in reaching a decision. (footnote omitted)'"


A case involving complex issues of the application of GAAS and auditor judgment calls is clearly not appropriate for summary disposition.  I have criticized the Commission for not granting summary affirmance in cases where ALJ's have sanctioned persons convicted or enjoined for securities fraud.  Perhaps someday the Commission will see fit to persuasively articulate why summary affirmance is not appropriate in those cases.  Using the standard set out in this case, summary affirmance would seem appropriate under those circumstances.