Private Investigators - Home Affairs Committee Contents


2  The risks of unregulated investigation

17.  While private investigation remains unregulated, there are serious risks that some private investigators will turn to illegal methods to achieve their ends. For example, using false cover stories to obtain access to confidential information—"blagging" or "pretexting" —or illegally paying public officials for access. These operators are sometimes referred to as "information brokers" in the industry.

A market in information

18.  The growth in availability of information creates two new risks. First, it is increasingly easy to access, store and transfer large amounts of personal data. Second, ease of access means that almost anyone with an Internet connection can offer investigation-style services without any background in the industry, skills or experience.

19.  The Association of British Investigators told the story of dilettante detectives who can sell their services without any training. It said that instead of posting sub-contracted instructions to a trusted fellow member, it was now "possible to outsource work instantly to a worldwide network of individuals purporting to be private investigators", who were "inexperienced, part-time amateurs" and not notified under the Data Protection Act.[23] The Association argued that this had damaged the integrity, quality, financial probity and professionalism of the industry over the past 15-20 years.[24] Witnesses from the private investigation industry echoed these views—G4S said that "someone can be a butcher today and a private investigator tomorrow without any proper checks".[25]

20.  The availability of other technologies had also facilitated entry to the private investigation industry. Gerry Hall of IPS International Ltd told us that the cost of surveillance technologies had fallen over recent years, so that a sophisticated transponder, which could be used for bugging, could be bought on the Internet for a few pounds.[26] The Surveillance Group expressed "grave concerns" regarding the illegal application of tracking and digital monitoring devices.[27]

21.  The Information Commissioner's Office had received complaints about:

a)  aggressive and inappropriate surveillance techniques used by investigators working for insurance companies;

b)  surveillance carried out in marital contexts, e.g. one spouse using an investigator to spy on the other;

c)  tracking devices found on vehicles; and

d)  private investigation companies' failure to give individuals access to information held about them, a requirement of the Data Protection Act.[28]

22.  In this context, we heard that a thriving market in personal data had developed. There was convincing evidence that the "reputable face" of private investigation, presented by a few major companies and trade associations, hides a market that slips below the radar of law-enforcement. The structure of the industry in the UK is pyramidal: Dan Morrison of Grosvenor Law LLP told us that there were four or five large investigating firms, then half a dozen medium-sized enterprises, followed by "many thousands" of sole traders.[29] The larger firms were careful to avoid taking on work that might compromise their corporate image, but the practice of sub-contracting was widespread. Kroll told us that its contractor base was continuously evolving as new contractors are added and others removed. When it submitted evidence, Kroll had 478 contractors on its database, including industry analysts, freelance journalists and business consultants, alongside academics, lawyers and licensed security consultants, translation agencies and expert providers such as fingerprint and other forensic specialists.[30]

23.  Mr Morrison said that subcontracting left the client "no way of controlling who is doing the work" and that "the feeder end of the market is populated by people who will basically leave no stone unturned, irrespective of the legality, probity or ethical propriety of what they are doing".[31] This effect was clear in the case described by Julian Pike, of Farrer & Co LLP, in which he advised the News of the World to carry out surveillance. The News of the World instructed former policeman Derek Webb to observe Charlotte Harris and Mark Lewis.[32]

24.  G4S told us that the market was sustained by demand from companies and individuals who request information which is not readily or legally available but for which they are prepared to pay large sums of money, often in cash.[33] The Association of Fraud Examiners also emphasised that illegal activity would not take place unless there was demand for it and went as far as to call private investigators the "man in the middle".[34]

25.  The actions of private investigator Steve Whittamore are a case in point for the risks of an information-rich and an information-hungry society. The Information Commission told us that there were seventeen thousand lines of information in the dossiers of the Motorman files compiled by Whittamore, including 4,000 surnames.[35] These detailed a panoply of public employees illegally selling personal information, which had been gleaned from Government databases.

26.  Easy access to information poses a double risk. Personal data is easier than ever to access and a private profile of a person can be built from a desktop. The ease of access has also opened the information market to new and unscrupulous suppliers, who may not be registered with the Information Commissioner and are unlikely to understand the rules under which they ought to operate. Phone-hacking appears to be the tip of the iceberg of a substantial black market in personal information. This is facilitated by the easy availability of tracking and digital monitoring devices at very little cost.

Involvement in the justice system

27.  The close inter-marriage between the private sector investigators and police forces is a boon for the sector, but a significant risk. The report by Her Majesty's Inspectorate of Constabulary, Without fear or favour, described the threat of corruption of police officers posed by links with private investigators.[36] The Serious Organised Crime Agency's 2008 report on private investigators found that their interaction with police officers was an "increasing threat to law enforcement".[37] It found that:

Criminal private investigators [...] use corrupt employees in specialist areas such as law enforcement, local government, the communications industry, utility service providers, banking and other public and private sector areas where useful information is held.[38]

28.  When we raised this issue with the Minister, Lynne Featherstone MP, she told us that she had not seen the report, although the Home Secretary and Ministers were made aware of it in April 2012.[39] It is freely available on the SOCA website.

29.  We were very surprised that the Minister responsible for regulation of the private security industry had not even read the report of the Serious Organised Crime Agency on private investigators. The Government should set out a strategy for mitigating the risks posed by private investigators as soon as the Minister has read and reflected on the report.

30.  Speechly Bircham, a firm of solicitors, told us that there was no way for a law firm to confirm a private investigator's probity. This contrasted with the public disciplinary record maintained by the Solicitors Regulation Authority.[40]

31.  We were presented with evidence that links private investigators with serving police officers, in a case that demonstrates the close involvement of investigators with the justice system. GMB described evidence that "confidential information from Police files has been leaked to the Consulting Association [headed by a private investigator]", including notes on people's presence at demonstrations and records of contacts with the police.[41] Mike Schwarz, partner at Bindmans LLP, described "the unregulated, unsupervised and invisible participation of private investigators within the heart of the criminal justice process".[42] He shared evidence with us that suggested that a single private investigation firm had served three clients involved in one case as "surrogate solicitors" and passed legally privileged information between the parties, including information from the defence side to the police.[43] This was in breach of principles set out in the Solicitors Regulation Authority Code, such as rules on conflicts of interest, which are described as "critical public protection".[44]

32.  Mr Schwarz also made serious allegations of police corruption. There was evidence which suggested that a private investigation firm had obtained confidential information about the police investigation.[45] He submitted documents which he said implied that about half a dozen payments totalling about £20,000 were paid by private investigators over a period of eight or nine months to confidential sources, possibly serving police officers.[46] According to Mr Schwarz, two of the key officers in the case were still on duty on the same case and one has retired and even been employed by the same private investigation firm.[47] The firm confirmed to us in subsequent correspondence that it had engaged the officer for consultancy work for a total of six hours' pay.

33.  He also suggested that the Independent Police Complaints Commission did not appear to be conducting an effective or speedy investigation into the allegations. It had decided simply to supervise the investigation of the Metropolitan Police Service's own anti-corruption unit, rather than take on the investigation itself.[48]

34.  We contacted the private investigation firm implicated [RISC Management Ltd], which strongly denied the suggestion that any such payments were made.[49] Arrests of serving and former police offers were subsequently made and the matter should certainly be taken with the utmost seriousness.

35.  In order to garner "premium" information that commands the highest prices, we heard troubling allegations that private investigators maintain close links with contacts in public service roles, such as the police forces. These links appear to go beyond one-off contacts and therefore to constitute an unacknowledged, but deep-rooted intertwining of a private and unregulated industry with our police forces. The Independent Police Complaints Commission should take a direct control over investigations in cases alleging police corruption.



23   Ev 65 [ABI] Back

24   Ev 65 [ABI] Back

25   Ev w2 [G4S]; Ev 64 [ABI] Back

26   Home Affairs Committee seminar on private investigators Back

27   Ev w8 [The Surveillance Group Ltd] Back

28   Ev 69 [ICO] Back

29   Q 433 [Dan Morrison] Back

30   Ev 80 [Kroll] Back

31   Q 433 [Dan Morrison] Back

32   Q 230 and Q 247 [Charlotte Harris] Back

33   Ev w2 [G4S] Back

34   Ev w21 [ACFE] Back

35   Q 8 [Christopher Graham] Back

36   HMIC, Without fear or favour: A review of police relationships, December 2011 Back

37   Q 119 [Commander Spindler] Back

38   SOCA, Private Investigators: The Rogue Element of the Private Investigation Industry and Others Unlawfully Trading in Personal Data, January 2008 Back

39   Q 462 [Lynne Featherstone] Back

40   Ev w28 [Speechly Bircham] Back

41   Ev w25 [GMB] Back

42   Ev 88 [Mike Schwarz] Back

43   Q 411 [Mike Schwarz]; Q 412 [Mike Schwarz] Back

44   Ev 88 [Mike Schwarz] Back

45   Ev 88 [Mike Schwarz] Back

46   Q 418 [Mike Schwarz] Back

47   Q 433 Back

48   Ev 88 [Mike Schwarz] Back

49   Ev 88 [Mike Schwarz]; Ev 92 [RISC Management Ltd] Back


 
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© Parliamentary copyright 2012
Prepared 6 July 2012