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Private investigators – what checks do you make when instructing them?

[1]Many law firms use the services of private investigators but how many carry out proper due diligence on them and their activities?

The use of private investigators has come to the attention of the public and regulators due to the phone hacking scandal and recent court cases related to it. Use of private investigators will also become a bigger issue this year when the Security Industry Authority starts to regulate the sector.

Licensable activities of private investigators are defined in the Private Security Industry Act 2001. An SIA licence will be required by anyone involved in any surveillance, inquiries or investigations that are carried out for the purposes of:

Contracted private investigation services will require a licence.

Law firms would normally instruct private investigators when dealing with cases such as family, PI, criminal and corporate transactions, but could do so in other cases where felt appropriate.

As with all things done by law firms, care must be taken not to breach the core principles, for example, not acting with integrity, not behaving in a way that maintains the public trust, etc. Firms must also bear in mind Outcome 7.10 in relation to outsourcing, and the requirement to ensure the outsourcing agreement allows the SRA to obtain information from, inspect the records of, or enter the premises of the company in relation to the outsourced activities or functions.

Although you can’t paint all private investigators with the same brush, it is clear that some are disreputable and therefore firms must be careful not to engage with those that act improperly.

So what should law firms do before instructing private investigators?

A very useful article about instructing private investigators appeared in the Law Society Gazette in March 2014 and I would recommend reading it, especially when one of the investigators interviewed said, ‘There are some real sharks out there who can be totally convincing, but who will take your money without doing the job. They will obtain data illegally, which could rebound on the reputation of the law firm and its client, and cost you fines. They will also frequently provide information that is inadmissible as evidence in a court of law – and so waste your money if you paid them to get it.’

Law firms instructing private investigators need to assess their exposure to the new regulations and their current obligations under the SRA Handbook; clearly this area poses real risks and therefore the firms involved should consider placing the issue in their risk register.

Brian Rogers, Riliance [2]