Corporate spies clean up

NEW YORK (Fortune) -- If James Bond's "License to Kill" gets revoked, he'd have no problem finding work as a corporate spy. To the short list of sectors that stand to gain from the financial crisis, add corporate intelligence firms.

They are seeing a dramatic uptick in business from a surge of banks, private equity firms, and hedge funds that need to make sure those pesky multimillion-dollar investments they made when times were good will hold up.

Firms like Control Risks, a London-based risk consultancy staffed by ex-CIA agents, and its rival, New York-based Kroll say they have seen a 20% jump in new business over the past two months. Together the two firms control the majority of the market.

These spook outfits have long carved out a lucrative business investigating corporate fraud, performing due diligence, or simply ferreting out the things not on a balance sheet - be they a company's shady associates in Brazil or corrupt investors in Texas.

But in the recent heady times, some fast-moving investment outlets cut corners.

Now they are hoping to save face - and money - before precarious deals fall apart altogether. "The tolerance for failure has diminished," says Jim Brooks, who heads North American operations for Control Risks.

Already, spies-for-hire are finding a couple of embarrassing flubs.

Consider the more than $300 million that one international bank lent to a sketchy Russian magnate (we'd tell you who it was, but then we'd have to kill you). When he stopped paying his bills, the bank brought in Control Risks to find out where the money had gone. (They found the Russian could have funneled money out of the country through various, seemingly unrelated shell companies.)

Another big client, a Washington-based law firm, hired it to investigate a wealthy, if not highly leveraged, Bolivian who had been claiming poverty while secretly moving his assets to places like Poland, Switzerland and Slovenia.

Tactics range from mundane document searches to clandestine interviews with former employees, customers, or government officials. Much of the work is happening overseas, where public records don't always exist.

For the Bond wannabes, the new business isn't adding to the bottom line so much as replacing the business they lost when pre-deal due diligence went out the window. Still, they expect the boom times to continue.

"Companies are only beginning to deal with the situation," says Bob Brenner, who heads Kroll's business intelligence and investigations practice in the U.S.

It may not match the martini swilling and jet setting the real Bond gets to do, but it pays the bills, which in these times is exotic-sounding enough.