Private Investigators

Written evidence submitted by Security International [PI07]

Executive summary

Attempts at licensing Private Investigators (PIs) can be traced back to the 1950s.

The PI Industry assisted a number of politicians in promoting their bills on security/investigation/privacy.

PIs continued to promote licensing up to the 1990s with support from a number of eminent politicians with little to no support from the remainder of the security industry.

A reluctance to license PIs in the past was due to the fear that it would give them a licence to snoop. (Reginald Maudling.)

The PI industry has been studied by a number of notable academics who published their findings in books and modules for Masters Degree courses.

Regulation has not been introduced because; it is difficult to establish the core activities of PIs.The number of PIs is unknown and this paper suggests it is below 5,000 rather than the normally published 10,000.

This paper suggests that until the publicity from The Leveson enquiry the activities of PIs has not caused the public any concern unlike the situation of ten to thirty years ago.

The reduction of unlawful activity by PIs can be attributed to the Human Rights Act 1998 (HRA) and the Data protection Act 1998 (DPA) which can now impose a financial penalty on a PI of up to £500,000. The DPA also makes the client responsible for the activities of their PI.

It is extremely difficult to establish a commonality on the wide and diverse services provided by a PI and subsequently reduces the chances of being able to establish a suitable competency requirement.

Over the past 40 years government of either persuasion had not been convinced that there was sufficient reason to license PIs despite the widely reported illegal activities. Why should there be justification now when the illegal activities are considerably less and there is adequate legislation in place in the form of the HRA and DPA to protect the public.

Regulation without compulsory licensing would mean that the activity is regulated and not the PI. Where the activity was being conducted by the end user themselves the legislation would in effect be protecting them from themselves.

Investigation no mater how it is packaged is an intrusion into a person’s privacy. That intrusion is already regulated by the HRA and DPA and if it is consumer credit related also by the Consumer Credit Acts 1974 and 2006. It is suggested that further regulation of PIs is a case of over licensing.

It is difficult to arrive at a suitable costing for the license fee because the number of PIs is unknown. It is assumed that the initial costs will be similar to those faced by the Security Industry Authority which ran at a loss despite the licence fees of £350 from over 100000+ personnel. Unless the licence fee is well in excess of that the public purse will have to meet the deficit in order to protect the public from a threat that is considerably less than it was ten to twenty years ago.

The additional cost of training for investigators to demonstrate their ability to achieve the required competency is likely to be in the region of £2000. This additional financial burden on an industry populated mainly by sole operators is I suggest a burden too far. Resulting in a decline in PIs and less revenue to finance the regulation.

Introduction

My references to PIs throughout this paper are those that are not employed by a Public Authority or employed in-house. I suggest that thorny subject is best left for a later date.

Attempts at licensing PIs can be traced back to the early 1950s. Members of the British Detective Association, later e the Association of British Investigators (ABI), attended the House of Commons to petition the then Home Secretary for licensing.

Peter Heims former president of ABI actively campaigned during the 1960s and early 1970s for licensing. Peter provided valuable assistance to a number of politicians who tried to introduce some form of control over PIs often included in a variety of Privacy Bills.

Tony Gardner; the Private Investigators Bill 1969.

Security Industry Licensing Bill 1970; Norman Fowler.

The Younger Committee on Privacy 1970.

The Private Detectives Control Bills 1 and 2 1973; Michael Fidler.

Private Security (Registration) Bills, 1977, 1985, 1987; Bruce George.

John Grant, principle of The Institute of Professional Investigators (IPI), in the mid to late 1970s continued these efforts. The IPI commissioned their own draft of a bill to license PIs.

In 1985 Chris Brogan took up the baton with support from both ABI and IPI. Chris’ brief was to promote the licensing argument to industry, commerce and selected politicians and he received the valuable support of Lord Whitelaw and Bruce George.

At that time there was no support from the rest of Security Industry. The British Security Industry Association (BSIA) the largest security association refused to acknowledge that PIs formed part of the security industry. The International Professional Security Association (IPSA) viewed PIs as too small in number to be considered in the licensing debate which continued until the enactment of the Security Industry Act 1997.

The reluctance over the years to license the activities of PIs despite well documented illegal activities was attributed to the fear that it would give PIs "A licence to snoop." (Reginald Maudling.)

PIs have been the subject of a number of eminent publications.

Private Policing; Les Johnston; Deputy Director of The Centre for Police and Criminal Justice Studies. University of Exeter.

Private Investigators; Their services and their clients; Professor Martin Gill and Jerry Hart of Leicester University.

Private Policing; A module in Leicester University’s MSc in the study of Security Management.

Private Police; Hilary Draper; ISBN 0 14 02. 2061.5

Question 1

Why regulation has not already been introduced, ten years after the Security Industry Act established a statutory framework for it.

It is extremely difficult to establish the core activities of PIs. The Security Industry Authority’s (SIA) research has identified in the region of 100 activities performed by PIs. Admittedly many of them overlap. The National Occupational Standards for Private Investigators Draft 1.9 (January 2006) published by Skills for Security identifies 15 core skills. These skills relate to the services provided by the small/sole proprietor agencies which make up the vast percentage of the industry rather than the more niche areas of investigation such as; Fraud; Industrial Espionage; Due Diligence etc favoured by the larger agencies.

It is suggested that there are 10,000 PIs operating in the UK. The two main trade bodies in the UK the IPI and ABI have a joint membership of less than 1000. IPI also caters for serving police officers and military police officers. There are tracing agencies that operate for debt collection companies which specialize in tracing absconding debtors. I suggest that there are less than 50 of these agencies with few employing more than 5 personnel. How many retired police officers are operating part time to just keep their eye in, or individuals who whilst conducting other security functions occasionally provide an enquiry service are unknown. I would suggest that there are less than 5,000 whose main function is that provided by a PI.

Until the recent publicity now the subject of the Leveson enquiry the activities of PIs were in the last 10 years not thought to be of a major concern to the public. Investigation no matter how it is packaged is an intrusion into a person’s privacy. That Intrusion has to be lawful; reasonable and proportionate. Article 8 Human Rights Act 1998(HRA). The lawful basis in most instances will be provided by the Data Protection Act 1998(DPA); Schedules 2 and 3. The unlawful activities of PIs began to wane when these Acts were introduced. Clients were less prepared to run the risk of processing the personal data supplied by the PI whose activities they were now responsible for. Unlawfully processed information could be challenged using breaches of Articles 8 and 6 (right to a fair trial) HRA. (Jones v University of Warwick (2003) EWCA Lord Woolf; Martin v Mcguiness 2003 ScotCS198 (July)2003 Lord Bonomy; McGowan(Appellant) v Scottish Water EAT (2005) IRLR 167.)

Conclusion.

It is my submission that the answers to this first question are. The number of individuals that would be caught by this legislation is unknown and is likely to be less than half that figure normally suggested. The documented unlawful activity of PIs in the past ten years is perpetrated by a small number of individuals and is not to the same extent as it was ten to thirty years ago. The activities of PIs are so wide and diverse it has been difficult to establish sufficient commonality between the activities.

Question 2

Whether the case for statutory regulation has been made, including the potential for harm to clients and subjects of investigations in the unregulated industry.

In 1971 Leslie Huckfiled MP lectured members of the ABI on the ease with which private information could be easily obtained about members of the public.

In 1973 a 28 man squad lead by Detective Chief Superintendent John Hemsley conducted an investigation into leaks to PIs of information from Banks; Car Registration Offices; the Police Criminal Record Offices. Eighteen Private Investigators were arrested. The outcome of all eighteen cases is unknown to the writer . It is known that five were convicted two of which were sent to prison.

Section 161 of the Criminal Justice Act 1988 was introduced as a direct result of unsolicited letters from PIs to Peers of the realm offering to sell information obtained from banks, credit card companies, Police National computer. Section 161 made it unlawful to obtain buy or sell information obtained from a computer by deception. At one stage the House of Lords considered an amendment to make it unlawful to obtain any information by deception. This amendment was later with drawn in view of a clause that was to be included in the Data Protection Directive 95/46 EC from which the DPA resulted.. That clause is section 56 much discussed in PI circles and prosecuted with some vigour by the Information Commissioner’s Office. (ICO)

Conclusion

Past governments of either persuasion did not consider that a strong enough case had been argued for the licensing of PIs despite a greater proliferation of unlawful activity from the 1960s through to the 1990s than there is today. The DPA section 56 specifically deals with information obtained by deception. This section can be enforced by a fine of up to £500,000. In the next three years we are likely to be faced with even stronger Data Protection Legislation. Which will curtail the illegal activities of PIs even more so than the current DPA.

Question 3

Whether compulsory licensing should be part of the regulation and, if so, whether it should include competency criteria.

Regulation without compulsory licensing would mean that the activity of investigation would be regulated. Therefore any one searching the internet for other than their own personal use is likely to be caught by the regulation. Surely this would mean that in-house research/investigation would be caught by this legislation? This is protecting the consumer from themselves

If Compulsory Licensing is part of the regulation then an investigator who traces debtors for a consumer credit company would need to be licensed under the Consumer Credit Acts 1974 and 2006; The Data protection Act 1998 (The correct term is notification and costs £35 per year.); The proposed legislation. I suggest that is a case of over licensing.

The Competency Criteria for a Process Server will differ greatly from that of a Fraud Investigator. To establish the Golden Thread of competency, a term often used by the SIA, for PIs would in my view be so simplistic as to provide little to no protection for the consumer.

Conclusion

At this stage of the discussion I have no other comments to make with regard to this question.

Question 4

The likely cost of regulation to Government and the Industry.

Any form of regulation is likely to be based on similar regulation with similar set up costs. These costs will be expected to be met from the registration/licence fees imposed.

If there are 10,000 PIs then the income using the fee introduced for licensing of a manned guard of £350 will be £3.5 million. For manned guards the licence fee is for a period of 3 years. That equates to just less than £1.2 million per year.

If I am correct then using the figure of 5,000. PIs the income will be £1.75 million equating to £600,000 approx. With 100,000+ manned guards the Security Industry Authority (SIA) failed to break even in its first years of operation.

If competence is a requirement then that will require some form of training to be met by the PI or his employers. I have earlier referenced the fifteen core competencies suggested by Skills for Security. The going rate currently in the Security Industry for a training day is £350. If it was possible to do 5 subjects a day that is a 3 day training period at a cost of £1050. That does not include travelling or accommodation. A more realistic timetable for the training to have any value and to allow for assessment of what has been learned is likely to be nearer 3 subjects a day. The cost to the PI in this instance will be 5 days @ £350 = £1750. That would put the cost to the PI to in excess of £2000. These costings do not take into account the cost of Continuous Professional Development which in my view can only be met by attending courses/seminars. It is well known in PI circles that PIs are reluctant to go to school especially to revisit investigative processes that they have been providing for over 20+ years. Even more so where it may be a subject in which they have no interest or plans to provide as a service. Those retired police officers and agents who only from time to time provide investigation are in my view unlikely to wish to incur these costs which as the manned guarding industry experienced are not necessarily able to be offset to the client. Result less PIs to be regulated; less income to the regulatory body.

Conclusion

Unless a realistic fee is charged the public purse will have to meet the deficit to protect them from a harm which in my view is protected by the DPA and HRA and is considerably less than it was twenty thirty years ago. If the public purse is not to be the loser then a more realistic fee of in the region of £1,000 would seem to be the option. With training costs this is likely to decimate the business reducing the volume to be regulated.

January 2012