REGENTS' CONFERENCE ON PROFESSIONAL COMPETENCE

Keynote Speech by Consumer Advocate Ralph Nader

The Board of Regents of the State of New York, which has the responsibility for oversight and regulation of 38 professions (including public accounting) in the State of New York, conducted a conference for the regulators and the regulated on October 21, 1997. Among the many distinguished presenters were consumer advocate Ralph Nader; Robert Basten, president of American Express Tax and Business Services; Edward C. Sullivan, chair of the New York State Assembly Higher Education Committee; and New York State Society of CPAs Executive Director Robert L. Gray.

Nader, to some extent, found himself preaching to the choir, because for the most part those present were regulators with a strong public interest or those who, while being subject to regulation, realize the public benefit of such regulation. Nader spoke of the threat to the medical profession and high quality health care by the corporatization of the delivery of heath care through HMOs. As nonlicensed corporate executives exercise more and more control over the delivery of health care, he expects they may be challenged for the unauthorized practice of medicine. He made a strong pitch for the benefit to the public of larger budgets for government regulators. As an example, if regulators had been in a better position to deal with the problems of the Savings and Loan industry, enormous amounts of taxpayer dollars would have been saved. Nader noted that in the law profession, not one of the 38 under the regents oversight, is able to direct a percentage of the efforts of the
profession in public interest activities and in upholding the profession. He believes that if all the professions were to do that, some of the problematic public interest issues matters could be more effectively addressed.

Robert Basten, president of American Tax and Business Services (TBS) explained to a breakout group of accountants, engineers, and architects how it employs licensed CPAs to perform tax, accounting, and related consulting activities. While presently not subject to regulation, he indicated a willingness for TBS to somehow be subject to regulation for the work TBS's CPA employees perform. He expressed the concern that sometimes the regulator of an activity may become the captive of the group it regulates.

Executive Director Gray presented a summary of a more detailed paper available for distribution at the program on the determinants of competence of the regulated professional. Presently, according to Gray, regulation focuses on entry into a profession--does the candidate possess the necessary education and can he or she demonstrate an understanding of a body of knowledge--and discipline if that professional later engages in misconduct. Regulators spend little if any attention on the activities between the two extremes, on such things as peer review, the effectiveness of continuing education, and the culture and environment in which the professional operates. Gray concluded with a call for a holistic approach to regulation, which would encompass the full magnitude of the professional's service to the public.

Assemblyman Sullivan spoke of the regulator's responsibility to the public and not to the licensee. The regulator has no responsibility to feather the financial nest of the regulated in Sullivan's opinion. Neither does it have a responsibility of reducing the cost of professional services to the public by increasing the number of professionals who may lack the competence or skills the public needs.

The conference was organized and administered under the leadership of Johanna Duncan-Poitier, associate commissioner of the professions of the State Education Department. Regents Chancellor Carl T. Hayden and Education Commissioner Richard P. Mills also addressed the gathering. *