The Department of Trade and Industry's 80-strong team of investigators are to be given new powers to tackle company fraud and misconduct, as part of the Government's post-Enron reforms.
The new laws will be contained in the Companies Bill to be included in Wednesday's Queen's Speech. The DTI's corporate investigators, headed by Grahame Harp, have handled such high-profile probes as the Maxwell and Transtec affairs. However, the DTI has been criticised for lacking teeth and taking too long to investigate cases.
The Companies Bill, spearheaded by Jacqui Smith, the minister for corporate governance, will give the DTI's team four new powers. First, inspectors will be able to search and enter company premises without a warrant.
Second, the DTI will be able to interview anyone connected to a case, including auditors and suppliers of the companies involved. Inspec-tors' powers are currently limited to company directors.
Third, the DTI will have the power to ask the High Court to force individuals to hand over documents. At present, if someone refuses to comply, the DTI must resort to lengthy criminal proceedings.
Finally, the DTI will be able to extend legal protection to potential whistleblowers, by providing statutory immunity for breach of confidence.
The Government hopes the new laws will enable it to prosecute more directors for corporate wrongdoing. A recent DTI scalp was Allied Carpets' former managing director, Raymond Nethercott, who was given a suspended sentence after the DTI found he had falsely stated the company's sales and profits.
The Companies Bill will also give the Financial Reporting Review Panel new powers to investigate suspected accounting abuse.
Join our new commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies