Know who your investigators are

Know your investigators, say Nigel Brown, Chief Executive of GSS Global, and Tony Imossi, Managing Director of Solicitors’ Law Services.

Invariably the Private Investigators’ work is money loss related so it is right to concentrate on the issue of fraud for the purpose of assessing the situation as a service provider.

Fraud remains rampant throughout the world and the UK claims no immunity to this epidemic, which sits in organisations for many years ticking away like an unexploded bomb. Motivated by greed most frauds are committed by opportunists and thus whilst we are able to provide a preventative consultation service, inevitably frauds do occur and our investigative skills are required after such an unfortunate event. It is for this reason that companies such as GSS Global are emerging as specialist fraud investigators, with experience and knowledge of how to deal in the complex arena of pan international frontiers.

When investigating a fraud an Investigator is usually led to identifying money-laundering issues amid a catalogue of other misdemeanours. There are basically three routes that need immediate consideration:

• Criminal investigation by the appropriate areas of law enforcement.
• Civil action to attempt to contain the problem and/or pursue financial recovery.
• Further damage limitation (public relations).

Potential business does not surface because much of today’s major fraud (involving sums in excess of £750,000 or against the wider public) remains unreported due to several reasons including embarrassment and avoidance of a sudden loss of public confidence in the corporate victim.

Recovery for clients

As Private Investigators our usual interest is in the civil litigation and recovery area, however, times are changing opening opportunities for the investigative industry not previously available. GSS Global actively promotes seminars and workshop on countering money laundering to assist clients. This type of approach helps clients to see the pro-active approach that the investigative industry can take.

A recent Home Office report estimated the cost of fraud at £13.8 billion a year. The Serious Fraud Office has remarked that fraud is commonly said to cost the public annually 17 times the amount lost through burglaries. Yet, the public law enforcement forces have been substantially reduced, currently 600 police fraud officers in England & Wales.

Outsourcing fraud investigations to the private sector is being considered, possibly a panel made up of recently retired fraud squad police officers. This is one of various possible solutions. There is a mood of greater co-operation between the public and private investigation sectors.

Privacy laws

The most prohibitive legislation is that appertaining to privacy laws.

Tony Imossi, ABI President

“Legislation and changes brought about by the privacy laws have been turbulent in the UK, but history has shown time and time again how winners have emerged by taking bold steps to implement exciting new strategies”

Over the past few years, the public has become concerned with the ‘Big Brother’ threat by covert surveillance, intrusive surveillance and infringements on privacy and human rights - most of this concern was directed at the police, security services etc. As a result, a range of legislation followed to introduce control over such activities including:

• Data Protection Act
• Protection from Harassment Act (Primarily introduced to catch stalkers)
• Criminal Justice & Public Order Act (Made pre-text enquiries an imprisonable offence)
• Regulation of Investigatory Powers Act
• Human Rights Act

In the run up to the licensing of the security industry, in which Private Investigators are included (anticipated to be implemented in 2005 see www.PSIAct.org.uk) it is argued that ‘Licensed’ (and thus disciplined and trained) Investigators, duly Notified under the DPA should be afforded reasonable access to personal data. However, no privileges are expected to emerge from the licensing process.

The Data Protection concept was introduced to the UK by the Act in 1984. It has now taken a new and more serious meaning following a more Euro-wide co-ordinated Data Protection Act 1998 (DPA), which came into force in England & Wales in March 2000.

The Human Rights Act 2001, which brings this European 1952 concept, created in the aftermath of the outrages seen in WWII, into the English statute books, and the emerging judicial decisions too, threatens to have an adverse impact on the investigative methodology. This area of new law is as yet mostly untested and it is too early to identify with certainty long-term effects.

It is true that the enforcement of the privacy laws has shaken much of the investigative industry and this plus the considerable confusion in the judiciary because of The Human Rights legislation creates the need for a complete review of the industry. It is also true, however, that the more professional investigation agencies have adjusted their working practice to accommodate these restraints.

The UK investigative industry has taken the DPA issues very seriously and through the Association of British Investigators, a comprehensive DPA Best Practice Policy is being prepared for wider publication. It is anticipated that this policy, when approved by the authorities, will have a marked influence on the industry throughout Europe and beyond.

International instructions

One of the principal problems with cross border transactions arises from the differences in methodology, availability of data in the public domain, expectations of service and usability of information and reports provided. Here we focus on one particular problem that results in loss of clients. The DPA dictates that cross border instructions be categorised as emerging from:

• Within the European Economic Community (EEC)
• Outside the EEC

Instructions from within the EEC causes no additional DPA problems and subject to overcoming the usual misunderstandings that arise between parties who speak different languages, the only issue that requires extra attention is the payment method and invoicing.

However, accepting instructions from a client who falls outside the EEC, which may require data on an individual being exported, requires a detailed and extremely complex Contract to be pre-signed by the parties. The Association of British Investigators does provide a sample Contract but the experience has been that clients requested to sign the document are put off by what is perceived as an unnecessary administrative burden and delay and move their business on to a less scrupulous.

Case history

GSS Global has dealt with many international frauds, where hundreds of millions of dollars are either defrauded or laundered. The greatest difficulty is always trying to identify exactly where the losers are located, and if the law enforcement agency in that region would or could assist.

One also needs to understand that just because a client has been ‘used’ by a disgruntled employee or indeed a fraudster to launder money, they may not have lost financially. In fact, in a recent case our client actually gained financially from a money laundering operation that had taken place within their company. Laundering money is not always turning ‘bad’ money into good, but also good money into bad.

Unless the investigator is capable and knowledgeable of dealing in multiple jurisdictions, it could be extremely hazardous and ultimately costly to take on an instruction. Where we (GSS Global) have taken on instructions from other investigation agencies, often the agency has made the client promises or proposals that are realistic in their jurisdiction but impossible and sometimes even illegal in others.

How then does the initiating agency ‘back track’ into...“I made a mistake” or “well we actually can not do this”.

Qualification

The security industry as a whole is currently being processed for Government licensing and will come under control of the newly appointed Security Industry Authority (SIA). Until such time as licensing is implemented there are no statutory educational qualification requirements.

The SIA, with whom we enjoy a close relationship through our membership of the Association of British Investigators, has strongly indicated that the criteria to be implemented will cover two areas:

• Fit and proper evaluation
• Competency

Fit and proper evaluation is expected to be a clear criminal record having regard to relevancy and recency.

In the meantime clients should as a minimum due diligence check the following before engaging any English Private Investigator:

• DPA - Private Investigators should be Notified with the Information Commissioner as Data Controllers under the Data Protection Act 1998. This can be checked by name, address or notification number on www.dpr.gov.uk/search.html
• Consumer Credit Licence - It is normal that an Investigator’s activities will involve accessing information, which will require a licence from the Office of Fair Trading. A search of the Consumer Credit Register can be made by telephone on 020 7211 8608.

There are a number of voluntary qualifications available but the best safeguard clients have as to the integrity of the Investigators is to ensure they are members of a widely recognise association such as the Association of British Investigators (ABI). In addition to having a Code of Practice and Disciplinary Procedure the ABI does have in place a fit and proper evaluation, competency assessment, and it ensures that all its members are compliant with statutory requirements. To verify an Investigator’s membership access www.theABI.org.uk or telephone 01253 297 502.

American differences

North American agencies have had access to information easy for many years, and they have come to expect this information on ‘tap’ from others. The cultural differences between the two sides of the Atlantic are huge and often under estimated.

European agencies have developed imaginative and innovative ways of collecting information that is legal and accurate. This same piece of information is available to US agencies at a press of a button and sometimes at minimal cost.

There is also a lack of international understanding, which sometimes is so enormous that it is difficult for some to comprehend. A case of a US company with operations all over the world is a good example. The head of security simply could not understand why it was not easily possible to have a central control room, in Europe with a simple security guard speaking all the languages of Europe. Furthermore, he wanted the security guard to call up the local police in each country, if there was an alarm and ‘tell’ them to attend the site. Can you imagine, an English security guard, calling the local police in Frankfurt and demanding that they attend premises - in English of course.

Another case involved a senior security professional arriving at Heathrow airport in mid January with nothing but a light jacket and thin cotton trousers and hand luggage. “Do you know where we are going tomorrow?” asked the investigator. “Yes” answered the US security professional, “somewhere called Stockholm, it’s just across the border on the map”

New trends

The greatest influence on all commerce must be the advances in information technology. As Information is the product with which a Private Investigator does business it follows that IT has a huge impact in the availability of data, speed of access and processing, detection and tracking methods, and of course communications. This is simply demonstrated by the availability in recent times of the UK electoral register (some 46 million individuals) being accessible on one PC programme, thus enabling a search by name, address, family groups, or any part of each. Similar programmes exist for Companies House records, which goes as far as enabling a search to be made by date of birth only. Needless to state such databases are under severe attack from the Information Commissioner who is succeeding in putting the register that make up the databases out of reach.

This article has been reproduced from Professional Security Magazine, Feb 2003.

Links:
Nigel Brown, GSS Global
Tony Imossi, Solicitors’ Law Services