Renewing Colorado’s wildly successful state licensing program for private investigators should have been a no-brainer. Instead, it’s been a fight.
A version of this article first appeared on the author’s company blog.
Until 2015, Colorado was one of a handful of states without mandatory private investigator licensing at the state level. (As of 2020, only Alaska, Idaho, Mississippi, South Dakota, and Wyoming do not require statewide licensure.)
We’d had licensure until 1977, when a court case that questioned an unlicensed security company’s right to conduct investigations ended up in the Colorado Supreme Court; the court nullified the state’s PI licensing requirement, declaring that it didn’t clearly define what a private investigations business was.
In response, a group of investigators created the Professional Private Investigator’s Association of Colorado (PPIAC), hoping to advocate for a new — and better — statewide licensing law. Multiple legislative efforts failed, until June 1, 2015, when mandatory licensing went into effect, after a PI licensing bill passed during the 2014 legislative session.
That is the backstory as we sit here today, almost five years into the program … which is set to sunset later this year.
The entity that has oversight of this program in Colorado, the Department of Regulatory Agencies (DORA), periodically reviews regulations and other government programs to determine whether they should be renewed or repealed after a predetermined date. In autumn of 2019, DORA did a “sunset review” of the state’s PI licensing law and recommended that it be eliminated; the department cited few incidents of “bad actors” in the profession and could foresee “little to no consumer harm” if PIs operated without licensure.
Without a new bill, Colorado’s licensing law would end in September of 2020.
Why We Need Licensure
In order to understand how wrong this recommendation is, you have to go back to the legislative session of 2014, when mandatory PI licensing was still only a bill being heard by the Colorado legislature. During those sessions, legislators were provided with numerous examples of “bad actors” who were in the profession or claimed to be PIs. As the argument went, being an unlicensed state meant any PI with a criminal history who was unable to get licensed elsewhere (or was barred from practicing in a licensed state) could come to Colorado and set up shop with just a business card. Our citizens had no way of vetting these people and took a leap of faith that anyone claiming to be a PI was honorable and not a scam artist.
State Senator Linda Newell, who sponsored the bill, argued that “if any profession merits licensing,” shouldn’t one involving “surveillance, investigation into people’s private lives, database searching,” be one? (source: Greeley Tribune)
Today, with licensure, the consumer simply needs to log onto the DORA website to vet a licensed PI, or to find out whether the person is licensed at all. This also gives the consumer a place to report a PI who’s acting inappropriately or unprofessionally. With licensing also comes the requirement for a PI to have a $10,000 surety bond, which is another protection for the consumer. It’s a guarantee that professionals will perform the services they’ve promised to fulfill.
A new bill has been introduced into the 2020 legislative session to continue the program. During the hearings for this bill, DORA was asked the obvious question, essentially: You mean to tell me there were bad actors before licensing, and now there are minimal bad actors? Sounds like the program is working. Why do you want to discontinue it? The state representative who asked that question signed on to become a co-sponsor of the bill to continue PI licensing at the end of that meeting.
Colorado has a unique fiscal structure, in that a program like private investigator licensing can receive no (ZERO) general funds from the state or taxpayer dollars. Therefore, the program has to be self-sustaining through the licensing fees. Since Colorado had not had licensing for 37 years, no one knew how many PIs were working in the state.
DORA initially set the fees based on an estimate of 400 licensees, who would share the cost of running the program. Five years into the program, there are more than 1,000 licensed Colorado private investigators, which reduces the fees significantly for each licensee. In fact, DORA just posted the renewal fees for the licenses at $16 as of June 1, 2020.
Yes, the price of four lattes is what it costs the Colorado private investigator to renew a license.
The new bill has bipartisan support in both the House of Representatives and the State Senate. The bill stalled during the COVID-19 lockdown but has now passed on the floors of both sides of the legislature and is in the governor’s hands.
In summary, according to DORA, Colorado had bad actors before mandatory licensing and has minimal bad actors now. Colorado had ZERO consumer protection before mandatory licensing, and now the consumer has a very easy way to vet a private investigator and to file a complaint — as well as recourse against any financial malfeasance, by going after a PI’s bond. There are 2 ½ times more investigators licensed than anticipated, and every year the fees have gone down because of that growing pool of licensees.
Despite all that, DORA recommended to discontinue the program.
This should have been a no-brainer.
Let’s hope the governor does the right thing.
About the author:
Ryan Johnston is a surveillance specialist with 37 years of experience in insurance fraud investigations, domestic investigations and general investigations. He’s the owner/operator of Colorado Private Investigations, LLC in Denver, CO. You can follow him on Facebook and LinkedIn.