KPMG enters U.S. legal market with Arizona launch

One of the Big Four accounting firms is expanding into the U.S. legal industry. In February, KPMG received a special license from the Arizona Supreme Court to practice law under the subsidiary KPMG Law U.S.

KPMG’s move into legal services is more of a milestone than it may seem: It potentially opens the door for other accounting firms to follow suit, which would usher in a new era for the legal services industry in this country.

The Netherlands-based professional services firm already has a global network of law firms operating in 80-plus jurisdictions and its U.S. audit, tax, and advisory firm predates the law firm.

KPMG Law U.S. will offer a broad range of legal services that addresses the evolving needs of legal departments and helps clients gain efficiencies, according to a February statement from the firm.
“By combining cutting-edge artificial intelligence and advanced technology solutions with legal services, we are proud to be a first mover with this capability and to offer the most holistic range of tech-enabled services in the marketplace for our clients’ evolving needs,” Rema Serafi, vice chair for tax in KPMG’s U.S. firm, said in the statement.

Implications for Virginia

What does this mean for Virginia law firms? For now, the broader implications are limited, according to A. Benjamin Spencer, dean of the William & Mary Law School.

That’s because Virginia doesn’t permit nonlawyer ownership of firms practicing law, and KPMG can only provide legal services outside of Arizona if those services comply with another jurisdiction’s requirements. And changes that began in Arizona paved the way for KPMG to open a law firm.

In 2020, Arizona became the first state to lift the American Bar Association’s rule that prohibits nonlawyers from owning a law firm and the following year, the state established a program to widen the public’s access to legal services. In 2020, Utah’s Supreme Court likewise relaxed that same restriction on law firm ownership, and Washington’s Supreme Court announced in 2024 a pilot program to similarly expand legal access.

What will be interesting to watch is whether other jurisdictions will loosen those same restrictions, though Spencer says he doesn’t expect Virginia to lead the way.

While some critics of KPMG’s expansion into legal services have expressed concerns over potential conflicts of interest, the court order approving KPMG Law U.S. stipulated that the firm can’t provide legal services to clients for which it also performs financial audits.

Even with safeguards in place, some lawyers are reluctant to embrace KPMG’s move into law.

But KPMG’s entry into the legal marketplace, along with the potential of the other Big Four firms, will bring “much-needed” competition, Spencer says. What’s more, these new entrants could bring about innovations in client services that law firms have thus far been unable to achieve, he adds.

“This is a net positive development for the industry as a whole because the competition will spur improved services for clients, potentially at better cost levels,” Spencer says.

What’s more, graduates of Virginia’s law schools could potentially benefit, he adds, with an additional avenue for employment in addition to traditional law firms.

But while a one-stop shop model for accounting, tax, and legal services could provide efficiencies that would benefit business clients for most routine matters, there’s still a place for traditional law firms in the market, Spencer notes.

“Traditional law firms — for now — retain a significant advantage in the level of expertise and experience that they can bring to bear on the most complex legal challenges that businesses face.”