State Codes and Statutes
Statutes > Connecticut > Title20 > Chap389 > Sec20-281lSec. 20-281l. Contingent fees and referrals. (a) Except as expressly permitted by this section, a licensee shall not: (1) Pay a fee or commission to obtain a client; or (2) accept a fee or commission for referring a client to the products or services of a third party.
(b) A licensee, who is not performing any of the services set forth in subsection (c) of this section and who complies with the provisions of subsection (d) of this section, may accept a fee or commission for referring a client to the products or services of a third party if such referral is made in conjunction with professional services provided to the client by such licensee making such referral. Nothing in this subsection shall be construed to permit the solicitation or acceptance of a fee or commission solely for the referral of a client to a third party.
(c) A licensee shall not perform services for a client for a commission and shall not accept a commission from a client during the period that the licensee is performing for such client any of the following services or during the period that is covered by any historical financial statements that are involved in any of the following services: (1) An audit or review of a financial statement; (2) a compilation of a financial statement if the licensee expects or has reasonable cause to expect that a third party will use the financial statement and the compilation report does not disclose a lack of independence; or (3) an examination of prospective financial information.
(d) A licensee who is not prohibited under this section from performing services for a fee or commission or from accepting a fee or commission and who is paid or expects to be paid a fee or commission shall disclose such payment or expectation to any client or other person to whom such licensee recommends or refers a product or service to which the fee or commission relates.
(e) As used in this section, "fee" includes, but is not limited to, a commission, rebate, preference, discount or any other consideration.
(f) This section does not prohibit payments for the purchase of all, or a material part, of an accounting practice, or retirement payments to individuals who are or were formerly engaged in the practice of public accountancy, or payments to the heirs or estates of such individuals.
(g) Nothing in this section shall be construed to relieve a licensee from any requirement under federal or state law that obligates such licensee to obtain a license or authorization prior to referring a client to the products or services of a third party, including, but not limited to, any license requirements under federal or state securities or insurance laws.
(P.A. 92-212, S. 17; P.A. 00-42, S. 1; P.A. 01-195, S. 81, 181.)
History: P.A. 00-42 designated existing provisions as Subsec. (a), adding references to fees, making technical changes, limiting collection of fees and commissions by provisions of this section, and deleting provisions preventing collection of commission when party likely to be influenced by status of licensee and language re purchase of accounting practice or retirement payments, and added Subsecs. (b) to (g), inclusive, re acceptance of fee or commission for a referral, prohibiting commission during period covered by historical financial statements, re disclosure, defining "fee", re purchase of accounting practice or retirement payments and re federal or state law requirements, respectively; P.A. 01-195 made a technical change in Subsec. (c), effective July 11, 2001.
