Translated material
Professional secrets
Auditors want to protect the secrets of their clients
Tax persecution of businesses has recently made the issue of maintaining the professional secrets of lawyers, auditors, tax consultants and notaries particularly relevant. As the Tax Club participants said at the meeting “The Effectiveness of Legal Protection of Professional Secrets of Tax Consultants, Lawyers, and Auditors,” despite the fact that audit secrecy is protected by law, documents are seized from audit organizations without a court decision. Moreover, such actions of operative workers subsequently cannot be challenged in the courts.If such cases are repeated, then, according to the legal community, seizures in audit companies may be followed by a detailed investigation of each client. But not everyone will pass through this sieve.
One example of such actions by law enforcement agencies was given at the meeting by lawyer Yuri Tan from the Bartolius law office. Last year, operatives of the Moscow Organized Crime Control Department, on the basis of an investigator’s resolution, but without court approval, seized documents, confiscated documents and searched the auditing firm AristaLyuks. Although, according to the Law “On Auditing”, information about audited entities can be provided to authorities only by court decision, auditors have not found judicial protection. The Zamoskvoretsky Court of Moscow left the auditors' complaint unsatisfied, citing the fact that the Criminal Procedure Code (CPC) does not require obtaining a court decision to seize documents constituting an audit secret. Such a decision is required only to obtain information containing bank secrecy.
“But there cannot be precedence between federal laws,” says Mr. Tan. So now the audit firm is planning to file a complaint with the Constitutional Court. According to auditors, the provision of the Code of Criminal Procedure establishing that the seizure of documents containing secrets protected by law is carried out investigation with the sanction of the prosecutor, violates Article 23 of the Constitution. This article enshrines the right of everyone to the privacy of correspondence, telephone conversations and mail messages. Restriction of this right is allowed only on the basis of a court decision.
In addition, the constitutional rights of entrepreneurs, according to lawyers, are also violated by the norm of the Criminal Procedure Code that states that only such obtaining of evidence that contradicts the positions of the Criminal Procedure Code is considered illegal, even if many other laws are violated.
According to Nikolai Remizov from the law firm FBK, back in 1996, the developers of the law “On Auditing Activities” simultaneously wrote amendments to the Code of Criminal Procedure on severe punishment of officials who exceeded their powers by violating audit secrecy. But then these amendments were excluded under government pressure.
According to Nikolai Pavlenko, partner at the Georg-consult law firm, the point is not that audit confidentiality is not protected by law. The law protects it, but in order for employees of the prosecutor’s office, operational and investigative bodies to interpret these norms of the law correctly for themselves, it is necessary that paper folders with documents and safes be pasted with pieces of paper: “Constitutes a secret in accordance with such and such a law.”
According to the coordinator of the Tax Club, Vadim Zaripov, the issue of protecting the secrecy of auditors is a matter of protecting business as a whole. By seizing documents that a tax consultant works with, you can cause a domino effect when investigative authorities have claims and questions against all of his clients’ counterparties. The head of the legal service of FBK, Ilya Tseytlin, agrees with him. Lack of proper protection of audit confidentiality undermines clients' trust in auditing and consulting firms, he says. Entrepreneurs actually find themselves defenseless before the state with its constantly changing rules of the game. And on the other side of the barricades are investigators, prosecutors, financial monitoring service workers and tax officials.