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Originally published October 20, 2009 at 12:09 AM | Page modified October 21, 2009 at 12:49 AM

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Redmond accountant to get $500,000 settlement

The tiny state agency that regulates accountants has agreed to pay a $500,000 settlement to a Redmond accountant who accused the agency's staff of launching vindictive investigations against him.

Seattle Times staff reporter

The tiny state agency that regulates accountants has agreed to pay a $500,000 settlement to a Redmond accountant who accused the agency's staff of launching vindictive investigations against him.

The deal ends years of legal battles between Ed Clark, co-owner of the accounting firm Clark, Raymond & Co., who has waged a one-man war against what he calls corruption by the staff of the Washington State Board of Accountancy.

In the settlement, Clark agreed to drop seven lawsuits and appeals he had filed against the board staff since 2007. In exchange, the board agreed to close four licensing investigations it had opened against Clark and his business partners.

The $500,000 settlement is substantial for an agency with an annual budget of $1.5 million. The agency, which has 10 employees, licenses and regulates 15,000 accountants in the state. The small staff is overseen by a nine-member board appointed by the governor.

Rick Sweeney, executive director of the board, said the settlement, which contains no admission of wrongdoing, was strictly a business decision to avoid more legal costs.

The board, which is entirely funded by fees on CPA licenses — will pay the money out of existing funds for now. But the expense could cause the board to ask the Legislature to increase its licensing fees by 2012, a couple of years earlier than it had anticipated, Sweeney said.

Clark, who flew to Hawaii to unwind and celebrate the settlement, estimates he's spent $800,000 in legal fees in his disputes with the board. But he said he feels vindicated because the settlement ends years of "persecution and retaliation" against him by the board's senior staff, including Sweeney.

Clark noted the settlement does not end one important matter — a complaint he filed against Sweeney and other board staff. He hopes an independent investigation of their conduct will uncover evidence of corruption.

Earlier this year, Gov. Chris Gregoire's office turned down a request by Clark for such an investigation. Joyce Turner, deputy chief of staff, said in a March 27 letter to one of Clark's attorneys that she saw no evidence of corruption at the accountancy agency.

Clark's feud with the board goes back to 2004, when a former client filed a complaint accusing him of failure to disclose possible conflicts of interest.

According to Clark, the agency did little to investigate that "baseless" charge until he started questioning its handling of a separate complaint he helped a client file against another accounting firm. The agency responded by assigning his case to an aggressive investigator, Clark says. In 2007, he says he was hounded into accepting a reprimand and paid $3,500 to reimburse the board for investigative costs.

Clark was told that was the norm for similar cases, according to court documents. Yet when he later filed public-records requests asking to see examples of such cases, none were produced, he says.

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In response, Clark launched his crusade, bombarding the agency with public-disclosure requests on his case and others to prove he'd been singled out. In court papers, he claimed he'd found examples of other accountants accused of far more serious misconduct who escaped punishment.

Earlier this year, a Thurston County Superior Court judge ruled the board had violated the law by failing to turn some public records over to Clark.

As his battle with the board escalated, both Clark and his business partners found themselves the targets of multiple licensing investigations.

Those investigations, as well as Clark's lawsuits, will end as a result of the settlement. The deal also expunges the 2007 reprimand from Clark's record.

Jim Brunner: 206-515-5628 or jbrunner@seattletimes.com

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