Durant, a partner at the accounting firm BDO Stoy Hayward, has a knack for knowing the typical varieties of white-collar criminals seemingly lurking behind water coolers everywhere in the wake of the Enron scandal.

He is a forensic auditor, a formerly obscure profession that has gained prominence amid a series of high-profile cases of corporate malfeasance over the last year. Fraud squads for hire such as the one Durant runs are experts in rooting out everything from the accounting irregularities that brought down Enron to more run-of- the-mill cases when, say, a hotel worker inflates the dry-cleaning expenses and takes a kickback.

Harvey Pitt, the departing head of the U.S. Securities and Exchange Commission, proposed last week that U.S. companies be required to employ forensic auditors from time to time, giving them a second line of defense against fraud when ordinary auditors fail.

The proposal, which will be put out for public comment before any decision on whether to adopt it, was floated along with other plans for implementing accounting reform measures adopted by Congress. Under the plan, U.S. companies would have to hire forensic teams independent from their regular auditors even when there is no suspicion of fraud.

Even without mandatory forensic audits, investigators say business has been booming on both sides of the Atlantic in the wake of the high-profile corporate scandals that surfaced over the last year. And it is a lucrative business: Investigators say a forensic audit typically costs at least $100,000, even for simple cases at small companies

"We tend to get busier and busier as the economy dips and these things come to light," said Alex Plavsic, head of fraud investigations at KPMG Forensic in London. The firm says that company fraud cases worth l255 million ($394 million) were brought to British courts in the six months through July, more than double the volume in the previous six months.

In the United States, too, new allegations of accounting irregularities are sure to emerge, experts say, despite the regulatory measures being put in place to prevent fraud. Durant said forensic auditors at BDO Stoy Hayward were investigating what could turn into a $300 million case. He would not describe the company involved or the details

In exposing frauds that ordinary auditors miss, forensic teams must navigate a course of hurdles, from regulatory and legal limitations to technological constraints. They employ tools ranging from sophisticated software to old-fashioned persistence in interviewing suspects and potential witnesses.

"We've spoken to the cleaners, you always talk to the receptionists, the chauffeur they are the ones taking the fraudsters to the meetings," Durant said. "They know where it was and how long it went on. They know all the stuff that even the wife doesn't know about."

Some investigations start with an anonymous phone call from a whistle-blower, though forensic auditors say some would-be tell-all types have grown more cautious over the last year, perhaps because of concern about their jobs during an economic downturn.

The ability to identify whistle-blowers many countries, including the United States and Britain, have laws protecting them helps the investigators establish suspicion.

Then the hard work of securing evidence begins. Often, fraudsters keep a surprisingly large amount of information about their schemes on laptop computers. Forensic specialists employ technology that allows them to take a digital "image" of a computer's hard drive which records all operations performed on the machine without physically altering it.

The sheer volume of computer files, however, can make the job difficult. "The contents of a 20-gigabit hard drive would be a stack of paper as tall as the Empire State building," Durant noted.

Less technology-savvy fraudsters may make mistakes such as keeping around templates for fake invoices.

"Sometimes you actually have to go through a drawer, and there will be simply a scrap of paper with figures you recognize," said Robert Kerr, partner in forensic and investigation services at the accounting firm of Grant Thornton.

In Britain, investigators complain that their job is made more difficult by stricter privacy laws than those in the United States. Durant said that under Britain's Data Protection Act, for instance, auditors are not allowed to conduct blanket searches to check whether any worker of a company also acts as an outside supplier to his or her employer. Such arrangements can be signs of fraud because of the potential for conflicts of interest. Investigators are permitted to check on individual supply arrangements, but only if they suspect a specific worker.

Auditing teams also try to look at parts of a business where productivity and morale are low, and where staff turnover is high. But sometimes those who seem like eager beavers, at their desks from dawn to dusk, are the most likely fraudsters. From 9 a.m. to 5 p.m. they do their normal jobs, but at 7 in the morning or 9 at night, they may be cooking the books or erasing their trails. Typically, fraudsters are male, though whistle-blowers are often female.

In one case handled by Kerr, a managing director of the British subsidiary of a multinational company used false invoices and expense claims to bilk his employer of nearly l1 million. Payments of more than l200,000 to himself and family members were disguised as consulting fees, for example. A l50,000-sports car was expensed as a mobile work site.

But he had made the mistake of leaving false invoice templates on his computer along with the digital pornography that investigators say most fraudsters also seem to enjoy. The invoices were compared with the company's accounting records, and many of the listed "suppliers" turned out to be false.

Once the suspected culprit has been identified, investigators typically confront him in an effort to extract a confession. And this is where BDO Stoy Hayward's team has been confronted with sticky situations. One suspect pulled out a shotgun, another a baseball bat. A Portuguese fraudster made it clear he had excellent Mafia connections.

If events turn ugly, the authorities can be called in. But many companies prefer not to publicize suspicions of fraud in their midst. They may simply confront a fraudster with the evidence and try to recover as much money as possible.

-- Eric Pfanner, International Herald Tribune