Warren Calls on Accounting Oversight Board to Protect Investors Amidst Trump, Republican Attacks on Watchdog

Warren Calls on Accounting Oversight Board to Protect Investors Amidst Trump, Republican Attacks on Watchdog

"As the PCAOB develops its strategic priorities for the next five years, it must keep in mind its own mission to 'protect investors and further the public interest in the preparation of informative, accurate, and independent audit reports.'"

Text of Letter (PDF)

Washington, D.C. - U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, wrote to the Chairman of the Public Company Accounting Oversight Board (PCAOB), Demetrios Logothetis, responding to a request for public comment on PCAOB strategic priorities.

The Trump Administration and Congressional Republicans have recently attempted to eliminate the watchdog that was created after the Enron accounting scandal to protect American investors, a move that would further open the floodgates for corporate misconduct.

"I expect the PCAOB's strategic plan to spell out how it intends to fulfill its mission for the American people while facing these deeply concerning headwinds. As the SEC dramatically cuts its enforcement efforts, ignores corporate misconduct, and abdicates its responsibility to meaningfully police the capital markets, the role of public company auditors-and their regulator, the PCAOB-is even more critical to ensuring investor protection and protecting market integrity," wrote the Senator.

"I have not been shy about criticizing the agency when it does not live up to its standards. But when other federal regulators, like the SEC, are neglecting their responsibilities, the auditor and its regulator have a heightened importance and responsibility in protecting investors," wrote the Senator. "The PCAOB must engage in standard-setting that addresses current risks, such as protecting auditor independence and ensuring audit quality in light of private equity ownership of accounting firms, audit standards to address increasingly complex data center arrangements, and managing the role of AI in audit. PCAOB must also act to address rampant failures by PCAOB-registered auditors that are providing sham audits for crypto firms."

"Finally, in addition to standard-setting to ensure audit quality, the PCAOB needs to ensure firms are abiding by standards through a robust inspection and enforcement program. For too long, the PCAOB has identified a persistently high rate of auditing deficiencies… A slight decline in deficiencies in 2024 was promising-but much more work remains to be done. The PCAOB must, in its strategy setting for the next five years, address these ongoing failures that threaten market integrity and investor confidence in the system," the Senator concluded.

The Senator requests written responses detailing PCAOB's commitment to audit quality and investor protection by May 29, 2026.

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