Private investigator Capcon focuses on UK banks

Recent regulatory changes could spur increased demand for private investigators from banks, brokers and lawyers. The UK chief regulator, the Financial Services Authority (FSA), introduced its N2 rule in December 2001 – effectively exposing designated directors and senior managers at banks to unlimited personal liability for risk management errors resulting from the activities of their particular business lines.

Started in 1983, the firm originally focused on the leisure and brewing industry, but has also worked for a number of brokers and banks in the interim. It hired ex-stockbroker Karine Luckraft earlier this year to spearhead its targeting of financial services firms. Luckraft’s first encounter with Capcon came in 1994, when the broker she was working for hired the private investigator for an initial public offering deal it was working on.

This type of investigation is popular among Capcon’s clients: “We were called in at the back-end of a flotation because someone in a corporate finance team smelt a rat in the soon-to-be-floated company’s management,” Luckraft said. The business had already been vetted by a top-four auditor and a top-five law firm, both of which said all was well.

But Capcon discovered that suspicions about one of the managers were well founded. “He was wanted for money-laundering in relation to two companies in the Benelux region and was high-up on Interpol’s most-wanted list,” Luckraft added.

Establishing relationships with law enforcement agencies such as Interpol – the organisation that promotes and facilitates international police co-operation - is made easier with ex-police officers on the staff, claimed Bob Dulieu, head of Capcon’s investigations division. Dulieu said Capcon also uses non-traditional sources of intelligence, but declined to elaborate. Prior to joining Capcon in 2000, he was an officer in London’s Metropolitan Police for 15 years.

Despite the lack of initial public offerings and mergers and acquisitions activity, Capcon has around 20 city-related deals in the pipeline, claimed Luckraft.