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Hey Siri, Are You Recording My Client Information?

Posted on Nov. 11, 2021

Tax professionals conducting business from home could inadvertently allow virtual assistants like Alexa, Siri, Cortana, and Google Nest to collect sensitive taxpayer information and lead to ethics concerns, an IRS official warned.

The COVID-19 pandemic has brought many challenges for tax professionals working from home, including hiring and training employees virtually, gathering client information via conference calls and Zoom meetings, sharing documents electronically, and worrying about information being overheard.

Digital assistants have been transforming the way we live, having the ability to answer questions, conduct research, schedule appointments, and even shop for us. However, the technology behind them means that companies like Amazon and Google may be listening in, even when we don’t want them to.

Sharyn Fisk, director of the IRS Office of Professional Responsibility, noted that tax professionals are subject to ethical requirements concerning disclosure. Under American Bar Association Rule 1.6, a lawyer cannot reveal information related to the representation of a client without the client's informed consent. IRC section 7216 and its regulations also prohibit return preparers from disclosing taxpayer return information without their consent. The American Institute of CPAs has a similar restriction with its Rule 301.

Speaking November 10 at the virtual IRS Fall Tax Practitioner Seminar, Fisk said that on top of confidentiality requirements, Circular 230 requires tax professionals to be competent under section 10.35, which includes competence when using technology.

“There’s a lot of demand on our technological competence,” Fisk said. “If you’re working remotely from home, is your Siri or Alexa on in the room that you’re in? Because you could be inadvertently disclosing private taxpayer information because some Siri function is listening to you when you list off your client’s name, address, and identification number.”

A recent National Law Review article discusses the complications of smart devices, privacy, and related potential breaches of ethical obligations. It notes that law enforcement agencies have been issuing subpoenas for virtual assistant data in criminal cases to obtain voice clips and time-stamped logs of user activity.

In August the State Bar of California wrote a formal opinion on professional responsibility and conduct while working remotely, stating, “Lawyers should consider disabling the listening capability of smart speakers, virtual assistants or other listening-enabled devices unless needed to assist with legal services.”

Fisk said she takes similar measures, making sure to perform her work away from smart devices. She advised attorneys to do the same and to be aware of their surroundings. “Be wary of talk about your clients’ private information — personally identifiable information — when anything can overhear that you didn’t intend,” she said.

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