10 Things Your Private Eye Won't Tell You

For many, the term private eye likely conjures visions of the solitary gumshoe tailing a cheating spouse. In reality, infidelity cases represent only about 10 percent of PI work, says Jimmie Mesis, a PI of 28 years. Today's "professional investigator" — the preferred nomenclature — tends to work for a company, not individuals, ferreting out insurance fraud and performing corporate intelligence and background checks.

Marlo Swan is an example of the new face of PI work. The 36-year-old former investigator with Horsemen Investigations in San Francisco primarily checked up on worker compensation claims. Armed with a camera, she might sit all day in her car waiting for the "gotcha" moment to disprove claimants' injuries and reports, often getting by on two hours' sleep. "It's not very glamorous, and it's not very fun," Swan says.

Even so, the PI industry is growing steadily. There are currently more than 52,000 PIs in the U.S., and the Bureau of Labor Statistics projects an 18 percent increase over the next decade. The fastest-growing sectors: finance and mortgage fraud investigations, followed by identity-theft cases.

When it comes to police protection today, the thin blue line is fraying. Cities are scrambling to fill recruitment shortages — New Yorkneeds 3,000 officers; Boston, 1,000; and Washington, D.C., 300. The increased demands of post-9/11 terrorism prevention, not to mention the drain from officers serving in Iraq, has added to the strain. The upshot: Police departments are being forced tomake hard choices, focusing their energies on investigating crimes like murder, rape and robbery, while allocating fewer resources to fraud, larceny and even missing persons. "It's not that the police don't want to do their job," says private investigator Gary DiStefano. "Their resources are limited, and they need to prioritize."

Enter the private investigator. Mesis recalls a distraught client whose ex-wife had absconded with their son while he had full legal custody. Six years later neither the police nor the FBI had turned up anything; within 24 hours of accepting the case, Mesis says, he and his partner had located the ex-wife, had local authorities arrest her, and reunited father and son. As for the police department, he adds, "this was just another case amongst thousands of cases they have to deal with."

While many PIs have gone corporate, a good number still accept walk-in clients seeking anything from vetting a business partner to locating assets during a divorce. But for the average person, finding a reputable PI isn't easy. No national registry exists, since the profession is regulated by states, some of which have no licensing requirements. So how to find a PI? Not necessarily through an advertisement. Amy Gaff, controller of petroleum-services firm Gaftek, sought a PI after a $50,000 excavator was stolen from a construction site. She says she found the biggest, fanciest ad in the phone book and hired KMS Investigations, in Santa Ana, Calif. After six weeks and $3,500, KMS never located her property, Gaff says, though it twice charged her credit card $900 without her consent. Kevin Sianez, KMS's founder, says he doesn't recall the particulars of Gaff's case but that most people "don't understand the inner workings of how an investigation is done." (KMS is no longer in business.)

A better option: Ask your attorney for a referral, then meet the PI in person and request references. Also, verify that he's licensed and insured if your state requires it.

In 2005 William Berkeyheiser, 62, was shot to death on his porch in Upper Makefield Township, Pa., by a former coworker. Turns out the assailant, Stanford Douglas Jr., had hired A-Plus Investigations in Burlington, N.J., to track down his old supervisor. Douglas told the agency he was looking for an old Army buddy of his dad's. A-Plus never contacted Berkeyheiser to let him know someone wanted to find him — common practice for PIs, says Tyler Tomlinson, attorney for Berkeyheiser's estate: "It's the easiest way to prevent this." (Attorney Scott Tredwell, representing A-Plus CEO John Ciaccio in a wrongful-death lawsuit filed by Berkeyheiser's wife, says there was no reason to believe Douglas was going to harm anyone. The suit is still pending.)

Bruce Hulme, legislative director of the National Council of Investigation & Security Services, says this type of incident is rare and that there have been only four cases in 20 years of a client using a PI's services to commit murder. But Rob Douglas, editor of InsideIDTheft.info, says too many PIs' main concern is getting paid. "You have some people who wouldn't touch an inappropriate case with a 10-foot pole," but other "PIs who think, Hey, if I can get it, it must be okay."

When Paul Dank of Advanced Surveillance Group attended a PI conference earlier this year, he was dismayed by what he heard from some colleagues. "This discussion was about 'clients are morons,'" Dank says. "They talked about how they often charge hundreds of dollars for data they paid $10 for."

How to avoid getting taken? Try doing some investigating on your own. "A lot of things are public records you can find yourself," says Swan. To wit: Courts and government agencies offer troves of data. At the local level, you can get property-tax-assessor files, which bear the name of the owner, description of the property, its assessed value, sometimes even blueprints. State courts provide tax liens and judgments, while warrants, arrests and convictions are available at the clerk of court's office; go to www.uscourts.gov/courtlinks for bankruptcy records. Technology is also on your side: Computer-monitoring software Spector Pro ($100) records everything from e-mails and instant messages to Web activity and downloads. Digital cameras, video recorders and GPS come cheap as well — just Google "spy camera" for a multitude of options.

Pretexting, in which a person pretends to be someone else to get a third party to divulge confidential data, has long been a favorite tool of PIs. But to their consternation, privacy and other federal laws have increasingly prohibited the practice when contacting U.S. banks, phone companies or government agencies. Some PIs argue the practice is harmless and that working covertly is now very difficult without it. Others ignore the law. Like Emilio and Brandy Torrella. The Belfair, Wash., couple pleaded guilty to federal charges of masterminding a pretexting ring that obtained and sold income-tax returns, medical and phone records, and financial statements of 12,000 private citizens to customers including attorneys, insurance companies and other PIs.

The problem, as Rob Douglas sees it, lies with Congress and the Federal Trade Commission. "They never really go after these guys," he says. Joel Winston, associate director with the division of privacy and ID protection at the FTC, says the agency's hands are tied. "We've asked Congress repeatedly for many years for this authority," Winston says. "Hopefully, they will give it to us this time."

Knowingly or not, clients may demand illegal services from a PI. The most common requests: obtain copies of phone bills, bug a spouse's car and wiretap phones. The catch is that such ill-gotten evidence is inadmissible in court. Some PI firms give out mixed messages on the issue; the Electronic Privacy Information Center, a public-interest group in Washington, D.C., lists 40 sites that offer what it says are legally dubious investigative services, such as cellular, landline and even post-office-box records, while cautioning "for informational purposes only" and "not for use in court."

But there's a bigger risk: Knowledge of your PI's illegal activity can bring civil, state and federal charges against you. In 2006, lawyer Terry Christensen was indicted by a federal grand jury in L.A. on two counts of conspiracy and abetting a wiretap. The allegations include paying PI Anthony Pellicano to bug phones of billionaire client Kirk Kerkorian's ex-wife in a child-support case. Christensen faces up to 10 years behind bars if convicted. (A spokesperson for Christensen says he vehemently denies all charges and is confident of exoneration.) "Sometimes clients think they're being smart" by turning a blind eye to such tactics, says Mesis, but it can backfire.

Every year investigators rally against legislation designed to protect consumers' personal data. In fact, two bills that would ban the sale of Social Security numbers have PIs particularly concerned. If they pass, investigators could no longer readily access such information as your date of birth, address, place of employment and Social Security number. "[Being able to obtain this data] is probably one of the most valuable resources we have," says Bruce Hulme. PIs argue the legislation would make their jobs far more difficult and that illegal procurement of such information would only flourish. They also say thedata brokerages that provide this sort of info to investigators rigorously screen and audit requests to ensure their legitimate investigative purposes.

If it were up to the public, almost no personal data would be legally available. A 2007 poll by the Consumer Reports National Research Center found 89 percent of Americans want lawmakers to restrict access to Social Security numbers. The public's concern is well founded: In fiscal year 2008 the SSA's Office of the Inspector General fielded over 9,000 allegations of fraud involving Social Security numbers, opening 595 investigations in just the first half of that year. Douglas, the former PI, believes strict regulation is in order, citing the PI industry's weak record for "weeding out even the worst of the worst offenders."

For most people, the work PIs do is shrouded in mystery — which can translate into inflated expectations. Clients may end up paying considerable sums of money for results they neither desired nor predicted, despite a PI's best efforts. "It kind of disturbs some clients, but I don't know the outcome until it's done," says investigator Sam Brown. What you should expect is new information, if there is any to be had, not a pat resolution. "The report is the product, period," Brown says.

Once your PI is on the case, there's really no telling how long or difficult an investigation will be. Uncovering infidelity could take several months, whereas your PI may discover a clandestine timeshare in St. Croix in under a week during your divorce proceedings. Whatever the job, hold your PI accountable to the contract terms. If you agreed to weekly reports and sit-downs, see it through. And there should be no financial surprises. Your PI should account for her time, detailing what she did, where she went and how long it took. This goes for any subcontracted work too.

In the post-9/11 world, surveillance and information gathering have become common in the workplace, with employers tapping both technology and investigators to root out financial fraud, conduct employment screening and investigate business partners. The Office of Personnel Management, for example, subcontracts roughly 1.75 million inquiries annually to pro snoops, who vet possible government employees and contractors to ensure they have no criminal history or terrorist connections.

But how far-reaching are such practices in the corporate world? In his book The End of Privacy, former Hoover Institution Fellow Charles J. Sykes notes that one survey found two-thirds of the nation's largest corporations hire PIs to gather information about employees' private lives — and that was 10 years ago. "My sense is that this has gotten more intrusive," Sykes says. "As companies become more liable for employee behavior, they need to know the skeletons in the closet."