As a partner at a big City law firm, Cameron Scott made his living defending accountants. Now, as executive counsel of the Accounting & Actuarial Discipline Board (AADB), he is responsible for prosecuting them when they break the rules. And, like other City regulators, he has experienced a surge in his workload since the economic downturn began.

Few people, it is true, have even heard of the AADB. “It hasn’t got the most catchy title, but it pretty much does what it says on the tin,” Mr Scott said. A division of the Financial Reporting Council (FRC), it is responsible for investigating potential misconduct by auditors and actuaries in cases where there is a public interest, usually after a high-profile corporate collapse.

Mr Scott, 45, has run the watchdog since it started in 2004, amid the aftermath of the Enron scandal — before that, accountants had largely policed themselves through a hodgepotch of different professional bodies — and he, or at least the AADB, has 11 investigations on the books at present, according to the board’s website, seven of which have been opened in the past year.

In July, for example, the AADB announced that it was reviewing the audit of Cattles, the beleaguered doorstep lender, by PricewaterhouseCoopers (PwC). It is also probing BDO’s audit of XL Leisure, the travel operator that collapsed last September leaving thousands of Britons stranded abroad. Older investigations are open against Deloitte, for its role in the story of MG Rover, and against unnamed actuaries involved in the Equitable Life affair.

Firms that are found to have acted improperly face an unlimited fine, while individuals can lose their practising licences, so it is no surprise that Mr Scott has ruffled a few feathers. Several partners at Big Four accounting firms and City lawyers have complained that the AADB has taken on too many cases and that its investigations take too long.

They also criticise its record of success. In five years, the AADB has brought only two cases before a tribunal, winning one of them. In 2007, it suffered a setback when PwC was cleared of misconduct for its overseeing of the accounts of Mayflower, a bus manufacturer. To compound the humiliation, the AADB was ordered to pay more than £1 million in legal costs.

According to Mr Scott, however, the watchdog has been hampered by a lack of resources and by its limited powers. “When you think about the kind of cases we take on, as a body we don’t have a huge resource,” he said.

Mr Scott — previously a partner in Hong Kong with Barlow Lyde & Gilbert and Allen & Overy, the law firms — has only four staff to investigate potential misconduct by roughly 275,000 accountants and 20,000 actuaries. His administrative budget is just over £1 million, with about twice that to spend on investigating cases — a paltry sum when set against the millions of pounds that the big accounting firms spend on lawyers.

The AADB is further hampered by its lack of statuory powers. Unlike other professional regulators, it cannot compel witnesses to talk or companies to hand over documents. “Sometimes they co-operate, sometimes they don’t,” Mr Scott said. At least one case had to be dropped because the AADB could not get hold of the evidence it needed.

Mr Scott is pushing for reform, including streamlining the legal process to make it quicker and cheaper to resolve cases. He also wants greater powers to collect evidence.

The FRC, the AADB’s parent body, has agreed to review the regime next year, but sweeping reform is unlikely in an election year. In the meantime, Mr Scott plans to bolster his team and hints that other headline-grabbing investigations are in the pipeline.

Can we expect an inquiry into the auditors of Britain’s big banks? “It may be that there are issues that come out of the collapse of the banks that we’ll end up looking at,” he said.

Somewhere, an auditor just shifted in his seat.

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