Act No. 146
Public Acts of 2008
Approved by the Governor
May 28, 2008
Filed with the Secretary of State
May 28, 2008
EFFECTIVE DATE: May 28, 2008
STATE OF MICHIGAN
REGULAR SESSION OF 2008
Introduced by Reps. Farrah and Accavitti
ENROLLED HOUSE BILL No. 5274
AN ACT to amend 1965 PA 285, entitled "An act to license and regulate private detectives and investigators; to provide for certain powers and duties for certain state agencies and local officials; to provide for the imposition for certain fees; to protect the general public against unauthorized, unlicensed and unethical operations by private detectives and private investigators; to provide for penalties and remedies; and to repeal acts and parts of acts," by amending the title and sections 1, 2, 3, 4, 5, 6, 7, 8, 10, 14, 16, 17, 19, 20, 22, 24, 27, and 29 (MCL 338.821, 338.822, 338.823, 338.824, 338.825, 338.826, 338.827, 338.828, 338.830, 338.834, 338.836, 338.837, 338.839, 338.840, 338.842, 338.844, 338.847, and 338.849), the title and sections 1, 2, 3, 4, 5, 6, 7, 10, 14, 16, 17, 20, 22, 24, and 27 as amended by 2002 PA 474.
The People of the State of Michigan enact:
An act to license and regulate professional investigators; to provide for certain powers and duties for certain state agencies and local officials; to provide for the imposition for certain fees; to protect the general public against unauthorized, unlicensed and unethical operations by professional investigators; to provide for immunity for certain persons under certain circumstances; to provide for penalties and remedies; and to repeal acts and parts of acts.
Sec. 1. This act shall be known and may be cited as the "professional investigator licensure act".
Sec. 2. As used in this act:
(a) "Certified public accountant" means a person licensed as a certified public accountant under article 7 of the occupational code, 1980 PA 299, MCL 339.720 to 339.736.
(b) "Computer forensics" means the collection, investigation, analysis, and scientific examination of data held on, or retrieved from, computers, computer networks, computer storage media, electronic devices, electronic storage media, or electronic networks, or any combination thereof.
(c) "Department" means the Michigan department of labor and economic growth.
(d) "Insurance adjuster" means a person other than a professional investigator who, for a consideration, engages in the activities described in subdivision (e) in the course of adjusting or otherwise participating in the disposal of claims under or in connection with a policy of insurance. Insurance adjuster includes any of the following:
(i) A person who is employed on a salary basis by an insurance company.
(ii) A person, firm, partnership, company, limited liability company, or corporation who acts for insurance companies solely in the capacity of an independent claim adjuster while performing within that capacity.
(iii) A person, firm, partnership, company, limited liability company, or corporation engaged in the business of public adjuster acting for claimants in securing adjustments of claims against insurance companies and who does not perform investigative services including, but not limited to, surveillance activities.
(e) "Investigation business" means a business that, for a fee, reward, or other consideration, engages in business or accepts employment to furnish, or subcontracts or agrees to make, or makes an investigation for the purpose of obtaining information with reference to any of the following:
(i) Crimes or wrongs done or threatened against the United States or a state or territory of the United States, or any other person or legal entity.
(ii) The identity, habits, conduct, business, occupation, honesty, integrity, credibility, trustworthiness, efficiency, loyalty, activity, movement, whereabouts, affiliations, associations, transactions, acts, reputation, or character of a person.
(iii) The location, disposition, or recovery of lost or stolen property.
(iv) The cause or responsibility for fires, libels, losses, accidents, or damage or injury to persons or property.
(v) Securing evidence to be used before a court, board, officer, or investigating committee.
(vi) The prevention, detection, and removal of surreptitiously installed devices designed for eavesdropping or observation, or both.
(vii) The electronic tracking of the location of an individual or motor vehicle for purposes of detection or investigation.
(viii) Computer forensics to be used as evidence before a court, board, officer, or investigating committee.
(f) "Licensee" means a person licensed under this act.
(g) "Professional engineer" means a person licensed under article 20 of the occupational code, 1980 PA 299, MCL339.2001 to 339.2014, as a professional engineer.
(h) "Professional investigator" means a person, other than an insurance adjuster who is on salary and employed by an insurance company, who for a fee, reward, or other consideration engages in the investigation business.
Sec. 3. (1) A person, firm, partnership, company, limited liability company, or corporation shall not engage in the business of professional investigator for hire, fee, or reward, and shall not advertise his or her business to be that of professional investigator or of a professional investigator agency without first obtaining a license from the department. A person, firm, partnership, company, limited liability company, or corporation shall not engage in the business of furnishing or supplying, for hire and reward, information as to the personal character of any person or firm, or as to the character or kind of business and occupation of any person, firm, partnership, company, limited liability company, or corporation and shall not own, conduct, or maintain a bureau or agency for the purposes described in this subsection except as to the financial rating of persons, firms, partnerships, companies, limited liability companies, or corporations without having first obtained a license as a professional investigator from the department.
(2) The department, the attorney general, the Michigan state police, or a local law enforcement agency, on its own initiative or at the request of any other person or legal entity, may investigate allegations of a person or legal entity engaging in activities regulated under this act without being appropriately licensed or exempt from licensure under this act. The entity conducting the investigation shall report its findings to the attorney general and county prosecuting attorney having jurisdiction in the location within which the alleged violator is engaged in business. The attorney general or county prosecuting attorney may bring an appropriate civil or criminal action in a court of competent jurisdiction to enjoin any person or legal entity that has engaged or is about to engage in any activity regulated by this act without being appropriately licensed or exempt from licensure under this act. Such an injunction may be issued without proof of actual damage sustained by any person or legal entity. Issuance of an injunction shall not prevent criminal prosecution of a violator. In addition to issuing the injunction, the court may impose a civil violation fine not to exceed $25,000.00. A person or other legal entity who reports to the department, a local law enforcement agency, a county prosecuting attorney, or the attorney general regarding an allegation of unlicensed activity is immune from tort liability for making the report.
(3) A person violating this section is guilty of a felony punishable by imprisonment for not more than 4 years or by a penal fine of not more than $5,000.00, or both.
Sec. 4. This act does not apply to any of the following:
(a) A person employed exclusively and regularly by an employer in connection with the affairs of the employer only and there exists a bona fide employer-employee relationship for which the employee is reimbursed on a salary basis.
(b) An officer or employee of the United States, this state, or a political subdivision of this state while that officer or employee is engaged in the performance of his or her official duties except that such officer or employee does not include a professional investigator hired or employed under contract by the United States, this state, or a political subdivision of this state.
(c) The business of obtaining and furnishing information as to the financial standing, rating, and credit responsibility of persons or as to the personal habits and financial responsibility of applicants for insurance, indemnity bonds, or commercial credit.
(d) A charitable philanthropic society or association duly incorporated under the laws of this state that is organized and maintained for the public good and not for private profit.
(e) An attorney admitted to practice in this state in performing his or her duties as an attorney at law.
(f) A collection agency or finance company licensed to do business under the laws of this state or any employee of a collection agency or finance company while acting within the scope of his or her employment when making an investigation incidental to the business of the agency, including an investigation of the location of the debtor or his or her assets and property in which the client has an interest or upon which the client has a lien.
(g) An insurance adjuster who is employed on a salary basis by an insurance company or a person, firm, partnership, company, limited liability company, or corporation that acts for an insurance company solely in the capacity of claim adjuster. A person, firm, partnership, company, limited liability company, or corporation engaged in the business of public adjuster acting for claimants in securing adjustments of claims against insurance companies and who does not perform investigative services including, but not limited to, surveillance activities.
(h) A professional engineer acting within the scope of his or her licensed professional practice who does not perform investigative services, including, but not limited to, surveillance activities or other activities outside of the scope of his or her licensed professional practice.
(i) A certified public accountant acting within the scope of his or her licensed professional practice who does not perform investigative services, including, but not limited to, surveillance activities or other activities outside of the scope of his or her licensed professional practice.
(j) A bail agent authorized under section 167b of the Michigan penal code, 1931 PA 328, MCL 750.167b, while performing his or her duties as a bail agent.
Sec. 5. (1) The department, upon application and after making a determination that the applicant is qualified, shall issue the applicant a license to conduct business as a professional investigator for a period of 3 years from date of issuance.
(2) Upon the issuance of a license under this act to conduct business as a professional investigator, the applicant is not required to obtain any other license from any municipality or political subdivision of this state.
Sec. 6. (1) The department shall issue a license to conduct business as a professional investigator if satisfied that the applicant is a person, or if a firm, partnership, company, limited liability company, or corporation, the sole or principal license holder is a person who meets all of the following qualifications:
(a) Is a citizen of the United States.
(b) Is not less than 25 years of age.
(c) Has a high school education or its equivalent.
(d) Has not been convicted of a felony, or a misdemeanor involving any of the following:
(i) Dishonesty or fraud.
(ii) Unauthorized divulging or selling of information or evidence.
(iii) Impersonation of a law enforcement officer or employee of the United States or a state, or a political subdivision of the United States or a state.
(iv) Illegally using, carrying, or possessing a dangerous weapon.
(v) Two or more alcohol related offenses.
(vi) Controlled substances under the public health code, 1978 PA 368, MCL 333.1101 to 333.25211.
(vii) An assault.
(e) Has not been dishonorably discharged from a branch of the United States military service.
(f) For a period of not less than 3 years has been or is any of the following on a full-time basis:
(i) Lawfully engaged in the professional investigation business as a licensee, registrant, or investigative employee in another state.
(ii) Lawfully engaged in the investigation business as an investigative employee of the holder of a license to conduct a professional investigation agency.
(iii) An investigator, detective, special agent, intelligence specialist, parole agent, probation officer, or certified police officer employed by any government executive, military, judicial, or legislative agency, or other public authority engaged in investigative or intelligence activities. This subdivision does not include individuals employed by educational or charitable institutions who are solely engaged in academic, consulting, educational, instructional, or research activities. In the case of the experience requirement under this subparagraph for an applicant demonstrating experience as a probation officer or parole agent, the department shall consider any application filed on or after January 1, 2005 for eligibility regarding that experience.
(iv) A graduate of an accredited institution of higher education with a baccalaureate or postgraduate degree in the field of police administration, security management, investigation, law, criminal justice, or computer forensics or other computer forensic industry certificated study that is acceptable to the department.
(v) Lawfully engaged in the investigation business as a full-time proprietary or in-house investigator employed by a business or attorney, or as an investigative reporter employed by a recognized media outlet, acceptable to the department. This subdivision does not include individuals employed by educational or charitable institutions who are solely engaged in academic, consulting, educational, instructional, or research activities.
(g) Has posted with the department a bond or insurance policy provided for in this act.
(2) In the case of a person, firm, partnership, company, limited liability company, or corporation now doing or seeking to do business in this state, the manager shall comply with the qualifications of this section.
(3) Beginning July 1, 2010, a law enforcement officer, as that term is defined in section 2 of the commission of law enforcement standards act, 1965 PA 203, MCL 28.602, shall not be issued a new or renewal license and shall not be employed and working in an investigative capacity by, or authorized to operate in a capacity as, a professional investigator unless the law enforcement officer obtains and produces, in a manner acceptable to the department, any1of the following:
(a) Written permission to act as a professional investigator from the current chief of police, county sheriff, or other official having executive authority and responsibility over the law enforcement matters in that jurisdiction if the law enforcement officer does not work under the authority of a chief of police or county sheriff.
(b) A copy of the law enforcement officer's jurisdiction's published policies and procedures allowing off-duty employment, which policies and procedures include the prohibition of the off-duty use of investigative tools or equipment, or both, provided exclusively for law enforcement and indicate that the off-duty employment as a professional investigator is not considered in conflict with employment as a law enforcement officer.
(c) A copy of the collective bargaining agreement of the law enforcement officer's jurisdiction.
(4) This act does not prevent a licensee from acting as a professional investigator outside of this state to the extent allowed by that other state under the laws of that state.
(5) The department may enter into reciprocal agreements with other states that have professional investigator qualification laws to allow a professional investigator license or registration to be used by that licensee or registrant within the jurisdiction of either this state or another state. The reciprocal agreement shall be limited to only allow professional investigators to continue investigations that originate in the investigator's home state and that require investigation in another state. The department may enter into a reciprocal agreement if the other state meets all of the following conditions:
(a) Issues a professional investigator identification card with an expiration date printed on the card.
(b) Is available to verify the license or registration status for law enforcement purposes.
(c) Has disqualification, suspension, and revocation standards for licenses and registrations.
(d) Requires the applicant for a license or registration as a professional investigator to submit to a criminal history records check pursuant to applicable state and federal law.
(6) Each reciprocal agreement shall, at a minimum, include the following provisions:
(a) A requirement that the professional investigator possess a professional investigator license or registration in good standing from his or her home state.
(b) A requirement that the professional investigator shall be time-limited to a maximum of 30 days per case while conducting an investigation in this state, or a lesser amount of time if required to comply with the reciprocity statutes or regulations of the other state.
(c) A requirement that the professional investigator from the other state not solicit any business in this state while conducting investigations in this state.
Sec. 7. (1) The department shall prepare a standard uniform application. The applicant shall obtain notarized reference statements from at least 5 reputable citizens who swear that they have known the applicant and his or her qualifications for a period of at least 5 years and believe that the applicant is honest, of good character, and competent. The individual providing the reference shall not be related or connected to the person so certifying by blood or marriage.
(2) Upon receipt of the application, application processing fee, and license fee as described in section 9, the department shall investigate as to the applicant's qualifications for licensure.
Sec. 8. If the applicant is a corporation, the application shall be signed and verified by the president, secretary and treasurer thereof, and shall specify the name of the corporation, the date and place of its incorporation, the location of its principal place of business, and the name of the city, town or village, stating the street and number, and such other description as will indicate the location of the bureau, agency, subagency, office or branch office for which the license is desired, and shall be accompanied by a duly certified copy of a certificate of incorporation.
Sec. 10. (1) The department may suspend or revoke a license issued under this act if the department determines that the licensee or licensee's manager, if an individual, or if the licensee is a person other than an individual, that an officer, director, partner, or its manager, has done any of the following:
(a) Made false statements or given false information in connection with an application for a license or a renewal or reinstatement of a license.
(b) Violated this act or any rule promulgated under this act.
(c) Been convicted of a felony or misdemeanor involving dishonesty or fraud, unauthorized divulging or selling of information or evidence.
(d) Been convicted of impersonation of a law enforcement officer or employee of the United States or a state, or a political subdivision of the United States or a state.
(e) Been convicted of illegally using, carrying, or possessing a dangerous weapon.
(f) In the case of a law enforcement officer issued a license under the conditions contained in section 6(3), violated the policies and procedures governing off-duty employment.
(2) In addition to the suspension or revocation provisions available to the department under subsection (1), the department may do 1 or more of the following regarding a licensee or a licensee's manager, if an individual, or if the licensee is a person other than an individual, an officer, director, partner, member, or its manager, who violates this act or a rule or order promulgated or issued under this act:
(a) Place a limitation on a license.
(b) Deny a renewal of a license.
(c) Issue an order of censure.
(d) Issue an order of probation.
(e) Impose a requirement that restitution be made.
(3) Upon notification from the department of the suspension or revocation of the license, the licensee, within 24hours, shall surrender to the department the license and his or her identification card. Failure to surrender the license in compliance with this subsection is a misdemeanor.
Sec. 14. (1) Upon issuing a license, the department shall also issue an identification card to the principal license holder or, if the agency is a partnership, to each partner or, if the license holder is a corporation or limited liability company, to each resident officer, manager, or member.
(2) The identification card issued under subsection (1) shall be in such form and contain such information as may be prescribed by the department and is recallable by the department for the same reasons as the license.
(3) The department shall only issue 1 identification card for each person entitled to receive it. The licensee is responsible for the maintenance, custody, and control of the identification card and shall not lease, loan, sell, or otherwise permit unauthorized persons or employees to use it. This subsection does not prevent each agency from issuing its own identification cards, if approved as to form and content by the department, to its respective employees. The individual identification card shall not bear the seal of the state or the designation of professional investigator, but the identification card may designate the employee as an investigator or operator and may state that the person is employed by a licensee of the department and the state of Michigan.
(4) Upon proper application and for sufficient reasons shown, the department may issue duplicates of the original license or identification card.
Sec. 16. (1) A person shall not possess or display a badge or shield that purports to indicate that the holder is a private detective, private investigator, or professional investigator.
(2) A licensee may request authorization to provide employee identification cards only upon the express authorization of the department as to format and content.
(3) A person shall not display any badge, shield, identification card, or license that might mislead the public into thinking that the holder is a licensed professional investigator.
(4) A person who violates this section is guilty of a misdemeanor and any unauthorized badge, shield, identification card, or license shall be confiscated by any law enforcement officer of the state. Each day the violation continues shall constitute a separate offense.
Sec. 17. (1) A licensee may employ as many persons as considered necessary to assist in his or her work of professional investigator and in the conduct of the business. At all times during the employment, the licensee shall have direct involvement in the day-to-day activities and is accountable for the good conduct in the business of each person so employed.
(2) A licensee shall keep adequate and complete records of all persons he or she employs, which records shall be made available to the department upon request and to police authorities if the police authorities offer legitimate proof for the request in connection with a specific need.
(3) If a licensee falsely states or represents that a person is or has been in his or her employ, the false statement or representation shall be sufficient cause for the suspension or revocation of the license. Any person falsely stating or representing that he or she is or has been a professional investigator or employed by a professional investigator agency is guilty of a misdemeanor.
(4) A licensee shall not knowingly employ any person who does not meet the requirements of this act.
(5) The licensee shall cause fingerprints to be taken of all prospective employees, which fingerprints shall be submitted to the department and the federal bureau of investigation for processing and approval.
(6) The fingerprints required to be taken under subsection (5) may be taken by a law enforcement agency or any other person determined by the department to be qualified to take fingerprints. The licensee shall submit a fingerprint processing fee to the department in accordance with section 3 of 1935 PA 120, MCL 28.273, as well as any costs imposed by the federal bureau of investigation.
Sec. 19. Any person licensed as a professional investigator, or in the employ of a professional investigator agency, is not authorized to carry a deadly weapon unless he is so licensed in accordance with the present laws of this state.
Sec. 20. (1) Any person who is or has been an employee of a licensee shall not divulge to anyone other than his or her employer or former employer, or as the employer shall direct, except as he or she may be required by law, any information acquired by him or her during his or her employment in respect to any of the work to which he or she shall have been assigned by the employer. Any employee violating the provisions of this section and any employee who willfully makes a false report to his or her employer in respect to any work is guilty of a misdemeanor.
(2) Any principal, manager, or employee of a licensee who willfully furnishes false information to clients, or who willfully sells, divulges, or otherwise discloses to other than clients, except as may be required by law, any information acquired during employment by the client is guilty of a misdemeanor and is subject to summary suspension of license and revocation of license upon satisfactory proof of the offense to the department. Any communications, oral or written, furnished by a professional or client to a licensee, or any information secured in connection with an assignment for a client, is considered privileged with the same authority and dignity as are other privileged communications recognized by the courts of this state.
(3) Suspension, revocation, denial, or other action against a licensee or applicant for a license as described in section 10 shall be accompanied by notice and an opportunity for a hearing under the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
Sec. 22. (1) An advertisement by a licensee soliciting or advertising for business shall contain his or her name and address as they appear in the records of the department.
(2) A licensee shall, on notice from the department, discontinue any advertising or the use of any advertisement, seal, or card, that the department determines to be misleading to the public. Failure to comply with such an order is cause for suspension or revocation of the license.
(3) Unless licensed under this act, a person shall not advertise his or her business to be that of a professional investigator regardless of the name or title actually used.
Sec. 24. (1) Each person, partnership, firm, company, limited liability company, or corporation licensed and operating under this act shall make a complete written record of the business transactions and reports made in connection with the operation of the agency.
(2) A professional investigator agency that receives or generates a written or electronic report shall keep the report on file in the office of the professional investigator for at least 2 years unless the file is returned to the client or agent.
Sec. 27. (1) Upon the death of a licensee, the business of the decedent may be carried on for a period of 90 days by any of the following:
(a) In the case of an individual licensee, the surviving spouse, or if there is none, the personal representative of the estate of the decedent.
(b) In the case of a partner, the surviving partners.
(c) In the case of an officer of a firm, company, association, limited liability company, or corporation, the officers.
(2) Within 10 days following the death of a licensee, the department shall be notified by a person described in subsection (1) in writing. The notification shall state the name of the person legally authorized to carry on the business of the deceased.
(3) Upon the authorization of the department, the business may be carried on for a further period of time when necessary to complete any investigation or assist in any litigation pending at the death of the decedent.
(4) This section does not authorize the solicitation or acceptance of any business after the death of the decedent except as otherwise provided by this act.
(5) This section shall not be construed to restrict the sale of a professional investigator business if the vendee qualifies for a license under the provisions of this act.
Sec. 29. The requirements of this act as to license applications shall apply to all professional investigators, except those who already have been granted a license under prior laws of this state. The requirements as to renewal of license certificates shall apply to all professional investigators licensed under this act or any prior law of this state.
This act is ordered to take immediate effect.
Clerk of the House of Representatives
Secretary of the Senate