Corporate Investigations: When Should a Business Hire a Private Investigator?

Most business problems do not begin with definitive proof. They begin with something that does not quite add up: unusual payments, unexplained stock losses, repeated absences, confidential information reaching a competitor or an employee whose activities appear inconsistent with what they have told the company.

At that stage, a business must decide whether the concern can be handled internally or whether an independent corporate investigation is needed.

This is not a niche problem. The Home Office Economic Crime Survey 2024 found that 27% of UK businesses with employees had experienced fraud during the previous 12 months, representing approximately 389,000 businesses. The survey estimated that these organisations experienced around 6.04 million fraud attempts between them, although the Home Office cautioned that the true figures may be higher because businesses can only report incidents they have detected.^[1]

A private investigator can help a company establish what has happened, document relevant activity and make informed decisions without relying on workplace rumours or assumptions. However, an investigation must have a clear purpose and be conducted lawfully, proportionately and with proper regard for data protection and employment procedures.

What Is a Corporate Investigation?

A corporate investigation is a structured enquiry into suspected wrongdoing, risk or undisclosed activity affecting a business. It may concern an employee, director, contractor, supplier, prospective business partner, former employee or competing organisation.

The purpose is not always to prove wrongdoing. A professionally conducted investigation may confirm an allegation, disprove it or show that there is not enough reliable evidence to reach a conclusion. Each of those outcomes can be valuable because it allows the business to make its next decision using facts rather than suspicion.

Corporate investigations can involve lawful open-source research, company and insolvency records, interviews, examination of information provided by the client, surveillance in appropriate circumstances and the documentation of relevant movements or meetings. The methods used should be selected according to the specific question the business needs to answer.

Private investigators do not have police powers. They cannot hack accounts, intercept private communications, trespass, obtain confidential records through deception or demand information that a member of the public would not be entitled to receive.

It is also worth noting that there is no reliable, up-to-date official count of private investigators working in the UK. Private investigation itself is not included in the Security Industry Authority’s current list of activities requiring an SIA licence.^[9] A House of Commons report published in 2012 cited industry estimates of between 3,000 and 10,000 investigators, but this is a historical estimate and should not be presented as a current headcount.^[10]

When Should a Business Hire a Private Investigator?

A company should consider external support when the allegation is serious, the facts cannot be established through routine management checks or an internal investigation would lack the necessary independence, expertise or discretion.

An external investigator may be particularly appropriate where:

1. The suspected conduct could cause significant financial, legal or reputational harm.
2. The person involved is senior, influential or closely connected to the internal decision-makers.
3. There is a risk that evidence could be deleted, altered or concealed.
4. The enquiry may require surveillance, tracing or specialist research.
5. The business expects the findings to be reviewed by solicitors, insurers, regulators or a court.
6. Confidentiality must be restricted to a small group outside the normal management structure.
7. An internal enquiry has produced conflicting accounts but no reliable conclusion.

The decision should still be proportionate. Not every policy breach requires surveillance or an extensive external investigation. A clearly documented expense discrepancy, for example, may be resolved by asking the employee for receipts and following the company’s normal procedures.

Suspected Internal Fraud

Internal fraud can involve false suppliers, diverted payments, manipulated invoices, unauthorised discounts, misuse of customer accounts, payroll irregularities or collusion between an employee and an outside party.

These cases can be difficult to investigate internally because the suspected person may understand the company’s financial controls and know which records are likely to be examined. They may also have access to systems, colleagues or suppliers who can help conceal what has happened.

A corporate investigator can help establish the identities, addresses, business interests and relationships connected to suspicious transactions. The investigation might examine whether a supplier is linked to an employee, whether meetings have taken place outside work or whether a supposed commercial arrangement has a genuine operating history.

The investigator’s role is to gather and report facts. Accountants, forensic accountants, solicitors or the police may need to take responsibility for other aspects of the case, particularly where complex financial analysis, asset recovery or criminal prosecution is being considered.

Large organisations should also be aware of the corporate offence of failure to prevent fraud under the Economic Crime and Corporate Transparency Act 2023. The offence came into force on 1 September 2025 and can apply where an associated person commits a specified fraud offence for the organisation’s benefit and the organisation did not have reasonable fraud prevention procedures in place.^[6] An investigation after an allegation arises is not a substitute for preventative controls, but it can help a business understand how an incident occurred and where those controls may have failed.

Theft, Stock Losses and Misuse of Company Property

Businesses can lose money through the theft of stock, tools, fuel, equipment, customer property or commercially valuable information. The loss may be obvious, but responsibility for it may remain unclear.

Before instructing an investigator, the company should preserve relevant records such as access logs, delivery paperwork, authorised CCTV footage, inventory reports and vehicle records. This helps establish patterns and prevents potentially useful information from being overwritten or lost.

Where there are reasonable grounds for concern, an investigator may be able to document relevant activity around a workplace, storage facility, delivery route or other public location. The precise method will depend on ownership, access rights, privacy expectations and the seriousness of the suspected conduct.

An investigation should be directed at a specific risk. General surveillance of an entire workforce in the hope of discovering something is unlikely to be proportionate or justifiable.

False Expenses, Procurement Concerns and Conflicts of Interest

False expenses may initially appear to be an accounting issue, but repeated or organised claims can point to wider dishonesty. Examples include fabricated mileage, duplicated receipts, personal purchases presented as business costs or claims for journeys and meetings that did not take place.

Procurement concerns can be more complex. A manager may be directing work to a business owned by a relative, receiving an undisclosed benefit from a supplier or manipulating a tender process in favour of a connected company.

Corporate investigations can help identify links between people and businesses using lawful sources such as Companies House records, published accounts, insolvency information, professional profiles, websites, historic trading information and other publicly available material.

A conflict of interest is not necessarily evidence of fraud. The relevant question may be whether the connection should have been declared, whether the decision-making process was compromised or whether the company suffered a loss. The investigator should therefore work to a carefully defined brief rather than beginning with an assumption of guilt.

Absenteeism and Suspected False Sickness Claims

Occasional absence is a normal employment issue. A private investigator should not be used simply because a manager is frustrated by an employee’s sickness record.

External investigation may become relevant where the business has specific and credible information suggesting that an employee is deliberately misrepresenting their circumstances. Examples might include claims that an employee is working elsewhere while receiving sick pay or undertaking activities that appear directly inconsistent with a stated incapacity.

Even then, apparent inconsistency does not automatically establish dishonesty. A person who is unfit for one type of work may still be able to exercise, attend appointments or carry out limited activities. Medical questions should be handled through appropriate occupational health or medical processes rather than decided by an investigator.

The purpose of an investigation is to document relevant observable facts. HR and medical advisers must then consider those facts alongside the employee’s explanation, the nature of their role and any medical evidence.

Undeclared Secondary Employment

Having a second job is not automatically unlawful or improper. It may only become a business concern where it breaches a contractual term, creates a conflict of interest, affects performance, involves misuse of confidential information or means an employee is working elsewhere during hours for which the original employer is paying them.

A corporate investigator may be able to establish whether a person is connected to another company, advertising competing services, attending another workplace or carrying out commercial activities at relevant times.

The investigator should not attempt to access private bank accounts, tax records, personal email accounts or restricted employment databases. Unauthorised access to computer systems and data can constitute an offence under the Computer Misuse Act 1990, while unlawfully obtaining personal information may breach the Data Protection Act 2018.^[11]

Competitor Activity and Misuse of Confidential Information

Competitors are generally entitled to compete, approach customers and recruit staff. An investigation is more likely to be justified where there is evidence suggesting unlawful interference, theft of confidential information, inducement to breach a contract, impersonation, unauthorised access to systems or collusion with an insider.

Warning signs may include a competitor appearing to know confidential prices, customer renewal dates, product plans or tender information that has not been made public. There may also be unexplained contact between a current employee and a competitor shortly before customers or staff are approached.

A lawful corporate investigation can examine public business connections, documented communications supplied by the client and observable meetings or activity. It cannot involve hacking a competitor, planting listening devices, intercepting communications, trespassing on its premises or obtaining records through false pretences.

Where the risk concerns hidden recording devices or unauthorised surveillance within an office, a separate technical surveillance counter-measures inspection, commonly known as a bug sweep, may be appropriate.

Breaches of Restrictive Covenants

Restrictive covenants can include non-competition, non-solicitation, confidentiality and anti-poaching provisions. They are intended to protect legitimate business interests after an employee leaves.^[7]

An investigator may be instructed where a former employee is suspected of working for a competitor, approaching protected customers, encouraging colleagues to leave or using confidential information to establish a competing business.

The investigation might document public marketing, company appointments, meetings, customer contact or other relevant conduct. However, evidence that a former employee has joined a competitor does not automatically establish an enforceable breach.

Under the current law, the starting position is that a non-compete clause is unenforceable unless the employer can demonstrate that it is reasonable. Enforceability depends on the drafting, the employee’s role, the interests being protected, the length and geographical reach of the restriction and the circumstances of the case.^[8]

A solicitor should therefore review the contract at an early stage. This can prevent a business from spending money investigating conduct that is not covered by an enforceable restriction.

Corporate Due Diligence

Not every corporate investigation begins with suspected misconduct. Businesses may also need independent due diligence before entering a transaction, appointing a senior executive, investing in a company, engaging a new supplier or forming a commercial partnership.

Basic due diligence may confirm company ownership, directors, insolvency history, trading addresses and publicly reported litigation. A more detailed enquiry may examine undisclosed business interests, inconsistencies in a professional history, links to failed companies, sanctions exposure or adverse information relevant to the proposed transaction.

Due diligence should be risk-based. A small routine supplier contract will not usually justify the same level of investigation as an acquisition, substantial investment or appointment to a position with access to money and sensitive data.

Information should also be assessed in context. A historic company failure, adverse article or past dispute should not be treated as proof that a person is dishonest. A good report separates verified facts, reasonable analysis and information that could not be corroborated.

Why Use an External Investigator Instead of Handling Everything Internally?

Greater independence

Acas advises employers to use somebody who is not involved in the case to conduct a workplace investigation, helping to avoid conflicts of interest and preserve impartiality.^[2] This can be difficult where the allegation concerns a director, owner, senior manager or member of the HR team.

An external investigator can provide separation from workplace relationships and internal politics. This does not automatically make every conclusion correct, but it can help the organisation demonstrate that the evidence was gathered independently.

Specialist investigative methods

Internal HR and compliance teams are usually experienced in interviewing employees, reviewing policies and managing disciplinary procedures. They may not have the field experience, resources or operational planning needed for surveillance, tracing or discreet enquiries outside the workplace.

An external investigator can support those teams without replacing them. The investigator establishes and documents facts, while HR applies company policy and ensures the employee is treated fairly.

Better evidential discipline

Informal enquiries can easily produce incomplete notes, altered files and second-hand accounts. A professional investigation should create a clear record of what was obtained, when it was obtained, where it came from and what it shows.

Acas recommends that an investigation report should be objective, factual, concise and include the evidence collected.^[2] Those same principles should guide an external investigator’s reporting.

Controlled confidentiality

A corporate investigation can affect staff morale, customer confidence and commercial relationships. Keeping the enquiry within a defined group can reduce gossip, protect witnesses and minimise the risk of evidence being destroyed.

Confidentiality should not, however, be promised in absolute terms. Information may need to be disclosed to the employee, a disciplinary decision-maker, a court, the police, an insurer or a regulator. Witnesses should not be told that their identity can never be revealed unless there is a proper basis for that assurance.

Corporate Investigations and Data Protection

Investigations involving identifiable people will usually involve the processing of personal data. The employer and investigator must therefore consider the UK GDPR and Data Protection Act 2018, as amended.

The business should identify its purpose and lawful basis before the investigation begins. Depending on the circumstances, it may also need to consider special category data, criminal offence data, data retention, access controls and whether an appropriate policy document is required.

Legitimate interests may sometimes be an appropriate lawful basis, but it is not an automatic exemption. The ICO says organisations should consider the purpose of the processing, whether the monitoring is necessary and whether the individual’s interests, rights and freedoms override the organisation’s interests. This assessment should be documented.^[3]

Information concerning suspected criminal activity receives additional protection. Article 10 of the UK GDPR restricts the processing of criminal offence data, and an organisation monitoring workers to detect criminal activity must identify an applicable condition under Schedule 1 of the Data Protection Act 2018.^[5]

Can a Business Carry Out Covert Surveillance on an Employee?

Covert monitoring is not automatically unlawful, but it is only likely to be justified in exceptional circumstances.

Current ICO guidance states that covert monitoring may potentially be justified where it is necessary to prevent or detect suspected criminal activity or gross misconduct. The ICO says it should be authorised by senior management, supported by a data protection impact assessment, targeted at obtaining specific evidence and limited to the shortest possible period.^[3]

Covert audio or video monitoring should not be used in places where people reasonably expect privacy, such as toilets or changing rooms. It should not ordinarily capture personal communications, and irrelevant information should not be retained simply because it was collected.

The ICO also makes clear that where a business hires a private investigator to monitor workers covertly, it should have a contract requiring the investigator to collect information in a way that satisfies the employer’s data protection obligations.^[3]

Surveillance must also be conducted in a way that avoids harassment. Repeated conduct that crosses the legal threshold could engage the Protection from Harassment Act 1997.^[12] Professional surveillance therefore requires careful planning, supervision and an ongoing assessment of proportionality.

Can a Business Track a Company Vehicle?

A business may be able to monitor a work vehicle for legitimate business purposes, but ownership of the vehicle does not remove all privacy and data protection obligations.

Employees should usually be informed about vehicle monitoring through an appropriate vehicle, privacy or monitoring policy. The purpose might include route planning, security, safety, protection of stock or verification of working time.

The ICO advises that where a company vehicle is available for private use, an employer will rarely be able to justify tracking it during that private use. Its guidance gives the example of a tracking system that employees can disable outside working hours.^[4]

Placing a tracking device on a vehicle that the client does not own or have authority to control raises significantly different legal issues. A reputable investigator should establish ownership, authority, purpose and data protection responsibilities before recommending vehicle tracking.

How Should a Business Prepare for a Corporate Investigation?

1. Define the question. State exactly what the business needs to establish. Avoid vague instructions such as asking an investigator to find anything suspicious about an employee.
2. Preserve existing evidence. Secure relevant emails, access logs, invoices, CCTV, expense claims, contracts and other records in accordance with company policy and legal advice.
3. Identify the decision-makers. Decide who will authorise the investigation, receive reports and deal with any disciplinary, regulatory or legal consequences.
4. Review the legal basis. Consider employment contracts, privacy notices, monitoring policies, data protection requirements and whether a DPIA or legitimate interests assessment is needed.
5. Agree written terms of reference. Set out the allegation, scope, permitted methods, timeframe, reporting arrangements and limits of the investigator’s role.
6. Plan the next stage. Decide in advance how findings will be handled, including whether HR, solicitors, insurers, the police or Report Fraud may need to be involved.

Acas recommends clear terms of reference and an investigation plan covering the issues to be examined, relevant witnesses, evidence sources, confidentiality, time limits and reporting arrangements.^[2]

How Corporate Investigators Work With HR Teams, Solicitors and Insurers

A corporate investigator should not operate in isolation when an enquiry could lead to dismissal, litigation, an insurance claim or a criminal report.

HR should normally retain control of the employment process. Even convincing evidence does not remove the requirement to investigate fairly, put relevant allegations to the employee and consider their response before reaching a disciplinary decision. Acas warns that failing to carry out a reasonable investigation can make a subsequent decision unfair and expose the employer to legal action.^[2]

A solicitor may help define the issues, review restrictive covenants, advise on privilege and determine whether urgent court action is appropriate. Early legal advice can be particularly important where the business may seek an injunction, preserve assets or bring civil proceedings.

Insurers should be consulted where the incident may fall within a fidelity, cyber, commercial crime, stock or liability policy. Some policies require prompt notification and may restrict the costs that can be incurred without prior authorisation.

Where there is evidence of fraud or cybercrime, a business can also make a report through Report Fraud, which replaced Action Fraud as the national reporting service for England, Wales and Northern Ireland in December 2025.^[13] A private investigation should not interfere with an active police investigation or delay an urgent report where people, assets or evidence are at immediate risk.

When Is a Private Investigator Not the Right First Step?

A private investigator may not be the right starting point where the business has no defined concern and simply wants to monitor someone in case they do something wrong. Investigations should respond to a legitimate issue, not be used for speculative fishing exercises.

An investigator is also unlikely to be the first priority where there is an immediate threat to safety, a serious cyberattack in progress, clear evidence of a major criminal offence or an urgent need to prevent funds from leaving an account. The police, bank, insurer, cybersecurity team or solicitor may need to be contacted first.

Similarly, an investigator should not be asked to decide whether an employee is guilty, whether a restrictive covenant is enforceable or whether a person should be dismissed. Those decisions belong to the employer, its HR team, legal advisers and, where applicable, the court.

What Outcomes Can a Corporate Investigation Produce?

A successful investigation does not necessarily end with dramatic evidence of wrongdoing. Its outcome may be:

• Evidence supporting the original allegation.
• Evidence showing that the concern was unfounded.
• A clearer understanding of how a loss or control failure occurred.
• Identification of another person or organisation involved.
• Information supporting an HR, insurance, civil or criminal process.
• Recommendations for further enquiries or specialist analysis.
• A conclusion that no proportionate line of enquiry remains.

A responsible investigator should be willing to report an inconclusive or negative result. The objective is to establish reliable facts, not to manufacture a finding that justifies the client’s original suspicion.

Corporate Investigation Services in London and the Home Counties

At SPS Investigations, we support companies that need discreet, factual and proportionate assistance with suspected fraud, theft, employee misconduct, conflicts of interest, undeclared employment, due diligence and other sensitive commercial concerns.

We begin by establishing what the business needs to know, what evidence already exists and how the findings are likely to be used. This allows us to recommend an investigation that is focused on a realistic objective rather than conducting unnecessary or overly intrusive enquiries.

Where appropriate, we can work alongside your HR team, solicitor, insurer or other professional adviser. Our role is to gather and report relevant facts lawfully and objectively, allowing your organisation and its advisers to decide what should happen next.

Based in London, we provide private investigation services to businesses across the capital and the surrounding home counties.

To discuss a potential corporate investigation in confidence, get in touch with SPS Investigations.

Frequently Asked Questions About Corporate Investigations

What is a corporate investigation?

A corporate investigation is a structured enquiry into suspected fraud, theft, misconduct, conflicts of interest, commercial risk or undisclosed activity affecting a business. It can involve research, evidence review, interviews, surveillance or other lawful investigative methods.

When should a business hire a private investigator?

A business should consider hiring a private investigator when the concern is serious, evidence is difficult to obtain internally, specialist investigative methods are required or an internal enquiry would not be sufficiently independent.

Can a private investigator investigate an employee in England?

Yes, an employee can be investigated where the employer has a legitimate purpose and the methods used are lawful, necessary and proportionate. The employer must also consider employment procedures, data protection and the employee’s reasonable expectations of privacy.

Can an employer secretly follow an employee?

Covert surveillance may be justifiable in exceptional circumstances, such as a specific and credible suspicion of criminal activity or gross misconduct. It should be senior-authorised, tightly targeted, time-limited and supported by a data protection impact assessment.

Can a private investigator read an employee’s private emails?

No. A private investigator cannot hack or gain unauthorised access to a personal email account. Employer access to communications held on business systems also requires a clear legal basis, appropriate policies and careful consideration of necessity and privacy.

Can a company track an employee’s vehicle?

A company may be able to track a company-owned vehicle for a legitimate business purpose, provided data protection and employment requirements are met. Tracking private use will rarely be justified, and a business should not place a device on a privately owned vehicle without proper authority.

Can corporate investigation evidence be used in a disciplinary procedure?

Potentially. Investigator reports, photographs, video and observation logs may inform an internal process, but the employer must still follow a fair procedure, disclose relevant allegations and give the employee an opportunity to respond.

Is evidence from a corporate investigator admissible in court?

It can be, but admissibility is never automatic. The court may consider relevance, authenticity, reliability, lawfulness and the way the evidence was recorded and preserved. The final decision rests with the court.

Are corporate investigations confidential?

They should be handled discreetly and information should be restricted to people who genuinely need it. Absolute confidentiality cannot always be guaranteed because evidence may need to be disclosed during disciplinary proceedings, litigation, regulatory enquiries or a criminal investigation.

How long does a corporate investigation take?

The timeframe depends on the question being investigated, the information already available and the methods required. A focused background enquiry may be completed relatively quickly, while surveillance or a complex fraud investigation may require work over a longer period.

How much does a corporate investigation cost?

Costs depend on the scope, number of investigators, location, duration, research requirements and reporting arrangements. A clearly defined objective and budget usually help keep the investigation proportionate and focused.

Should internal fraud be reported to the police?

Serious or ongoing fraud may need to be reported to the police or through Report Fraud. The business should also consider contacting its bank, insurer, solicitor or regulator. A private investigator can help establish facts, but should not delay an urgent report or obstruct a police investigation.

Legal note: This article provides general information about corporate investigations in England and is accurate to the best of our knowledge as of July 2026. It is not legal advice. Businesses should obtain advice from a suitably qualified solicitor, HR professional or data protection adviser regarding their particular circumstances.