Profession faces unexpected dangers across the globe

MIDDLE-AGED ACCOUNTANT David Adams perhaps assumed he was in a safe profession, but the two bullet wounds to his leg suggested otherwise.

The 43-year-old management accountant was shot twice in a case of mistaken identity in Istanbul during the troubled investigation of Polly Peck by Coopers and Lybrand in 1994.

Incidents like this run against the prevailing wisdom where accountancy is viewed as a tame and safe profession. Polly Peck and other cases demonstrate that sometimes, it’s the numbercrunchers in the crosshairs.

The Istanbul shooting was only the latest in a series of disturbing incidents linked to the Polly Peck investigation. Chris Howell, a senior member of the investigation team needed 20 stitches after being attacked outside his Istanbul flat. His car was also firebombed and others connected to the investigation reported headless chickens and dead cats left at their homes.

In the line of fire

Danger in the accounting profession is rare. Often its those who stumble upon fraud or find themselves investigating issues in dangerous parts of the world, who find themselves in harm’s way.

Earlier this month a man was arrested in Australia in connection with the four-year-old attempted murder of Leslie Cumming, former chief accountant of the Law Society of Scotland. Cumming was slashed across the face by a man in a dark balaclava outside his home in Murrayfield, in Edinburgh in January 2006.

Cumming has suggested the potential motive may have been his investigation of money laundering and corruption within Scottish legal circles.

Fraud audit, forensic accounting and insolvency are all areas which see accountants delving into dark corners, sometimes tracking down the proceeds of organised crime or, at times, terrorism.

Safety concerns so worried the Scottish accounting institute ICAS in 2006 that the body lobbied the Home Office to put in place greater protection of accountants under money laundering regulations.

Kidnapped

The appeal followed the kidnapping of Glasgow accountant Andrew Ramsay by two men posing as fraud detectives.

Ramsay was due to give evidence at a High Court case regarding VAT fraud. His skull was reportedly discovered by fishermen a year after his disappearance.

Adam Bates, global chair of forensic at KPMG, said it is very rare that accountants will find themselves in any kind of mortal danger.

“People look at the accountants and they say they are just doing the numbers,” he said. “Very occasionally we might go into area where there is some physical danger.”

The nature of forensic work has changed during his 25-year career. It’s now a major growth area with revenue climbing 30% in 2008, to more than £80m at KPMG. Bates’ forensic team expanded from 250 in 2006 to 360 in 2009.

The global nature of modern finance has seen accountants travel to danger zones like Iraq and Afghanistan. But technological developments have also meant forensic accountants can do much of their job sitting behind a desk.

“A long time ago you would have been searching people’s desks now you search their emails or via databases,” he said. Bates added the most dangerous work is increasingly from engagements with the emerging markets “if you are dealing with heavy-duty criminals coming out of Russia”, he said.

Accounting firms now routinely undertake extensive risk-management programs before accepting potentially risky assignments.

“We don’t accept every single job, we go through a very careful scrutiny and, if there’s a question mark, we ask, is it worth it,” Bates said.

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Stranded

Andrew Durant, forensic accountant with FTI Consulting, recalls being stranded in Sierra Leone during a military coup when he began as a forensic accountant.

“I was woken up by the state secret police on a Sunday morning… They wanted to know what I was doing in the country and who I was working for,” he said. “They had my passport and he showed it to me and I thought, if I was to leave, I can’t just get up and go.”

He also had to flee a southern European country after he inadvertently found himself face-to-face with a fraud suspect.

“There was no physical violence but there was a meeting where we met a third party who we thought could provide us with information,” he said. “Not understanding the local dynamics we spoke to someone who was part of the fraud.”

These days accounting firms rarely take on risky work without a thorough assessment, according to Durant.

“They don’t go in blind any more,” he said. “There are a lot of people who now understand what the potential dangers are.”

But sometimes there’s little warning of impending danger.

Steve Maslin, senior audit partner at Grant Thornton, recalls one audit engagement which saw him checking the underbelly of his car for explosives. “I spent about three weeks, on my hands and knees, in wet car parks looking under my car,” he said.

The audit client, a property firm, was resisting efforts by Grant Thornton to probe their accounts, Maslin said. Warning bells began ringing soon after Grant Thornton started the audit. “It was quite clear after about four to five weeks that something wasn’t right and we were asking questions of the management team and, well, something didn’t smell right…and as we were digging around we found some suggested links to terrorist organisations,” he said.

“At that point the senior management of Grant Thornton called me and the audit team together and said we might want to think about some professional security.”

“Threats were made and allegations thrown around, among other forms of intimidation… There was lots of shouting, I remember being on the phone Sunday night after Sunday night, with the chief executives,” he said.

Durant said forensic accounting in particular seems to attract certain personality types.

“I have been around the world on the back of forensic accounting and I’ve met all sorts of people and done all sorts of things,” he said.

“It is exciting and its different… It takes a particular type of person.”