How can a private investigator help in a case against a dishonest debtor? | In Principle

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How can a private investigator help in a case against a dishonest debtor?

Adam Studziński: Perhaps we should start with something general: how serious do you think the problem of debtor dishonesty is?

Tomasz Mostowski: As a private investigator, I have been searching for assets concealed by dishonest debtors for 12 years.

Over all those years, my colleagues from the industry and I have seen a rapid increase in the number of cases where debtors try to mislead their creditors in various ways. You could even say there’s a deepening pathology in this area, with highly damaging consequences for the legal system and for the social order. It erodes trust in the basic integrity of market participants. Without trust in debtors’ basic honesty, many business initiatives are doomed to fail from the outset, to the detriment of all.

How do dishonest debtors operate?

Unfortunately, debtors use all sorts of dishonest methods to evade their obligations. If we talk about it longer, I will try to present all the most characteristic types of dishonest debtor behaviour observed by my colleagues and me. Also, as much as I can, I will present the operational methods of identifying them and collecting evidence to expose them.

Is it legal to use private investigators to search for debtors’ assets?

The main legal basis in Poland for private investigators searching for debtors’ assets and powers facilitating this work is the Detective Services Act of 6 July 2001. Under Art. 2 of the act, detective services are defined as activities consisting in obtaining, processing and transferring information about persons, objects and events, performed on the basis of a contract with a client, in a form and within the bounds not restricted to state authorities and institutions under separate regulations. Among other things, these may involve matters arising from economic dealings relating to the performance of financial obligations, the ability to pay or reliability in those relationships, or the search for property or persons. Of course such actions must be lawful.

Here I will add that it is often important in cases involving the verification of debtors’ assets, for example, to determine their actual place of residence. It is a fundamental power of licensed private investigators or the businesses employing them to process personal data in the course of detective services without the consent of the data subjects. This is a key power facilitating the collection of information on debtors and their assets in conversations with persons around them, for example neighbours or co-workers. A person without a private investigator’s power cannot conduct such activities, as they could expose themselves to liability for processing the debtor’s data without their consent, and might also violate other laws, for example concerning defamation.

What specifically can a person obtain by using the services of a licensed private investigator?

The most concrete thing is a detective report. Among other things, a detective report can constitute evidence in a civil case. Although such a report does not enjoy any extraordinary privileges in evidentiary proceedings, in practice it is often the only evidence of what a person is doing, to what extent and where, who they are in contact with, where they live, what they do for a living, and what assets they own. Thus the court has every basis to deal with unambiguous and reliable findings based on the detective report, for example to determine whether the debtor is using an entity as a façade behind which to hide their assets, or to determine what assets are actually held by the debtor.

A private investigator looking for the debtor or the debtor’s assets can take actions that may look confusingly similar to a “sting” or “controlled purchase” (but are not, as those can be performed only by law enforcement authorities). However, it is possible to arrange a real business transaction so that it reveals the actual manner in which the “surveilled” entity operates and allows evidence to be collected for a court case. This evidence will be appropriately described or illustrated in the compact form of a detective report.

Is there anything else you would like to add, generally describing the private investigator’s involvement in cases against dishonest debtors?

In the private investigator’s work, close cooperation with lawyers specialising in protecting creditors from dishonest debtors is key. With such cooperation, it is possible to precisely determine the places, objects, groups of people, and vital evidence on which the private investigator should be particularly focused in order to provide the client evidence they can use to prove the dishonest of the debtor (or persons cooperating with the debtor) before the court or law enforcement authorities, and obtain protection of the creditor’s claims.

Thank you for talking to us today. If you allow, in our next conversation, I would like to talk about the most characteristic ways dishonest debtors operate.

I also thank you. I am at your disposal.

Interview by Adam Studziński