The House of Commons Home Affairs Committee has called on the Government to set up a "robust licensing and registration system" of private investigators.

The report of an inquiry into private investigators by the committee says that private investigators and their companies should be governed by a new Code of Conduct. Under the system a criminal record for breach of section 55 should disqualify individual from operating as private investigators. It concludes that it is getting easier for anyone to advertise themselves as a private investigator and while the industry remains unregulated a number of serious risks remain.

While recognising the honest contribution made by most private investigators, the report highlights the involvement of some private investigators in an illegal market in personal data and calls again on the Government to strength the penalties for data offences.

The committee chair, Rt Hon Keith Vaz MP, (pictured) said: "Recent high profile events, such as the phone hacking scandal, have thrown light on the sometimes shady world of private investigators. We have found that rogue private investigators are the brokers in a black market in information. They illegally snoop on our data, cash in on our private lives and only get away with a paltry fine.

It is time this industry was regulated, so that the honest majority can get on with their work. We expect the Government to act urgently."

The report recognises suggestions that the sector could have a role in the investigation of crime currently carried out by the police, while recognising that "whether this is desirable is a matter for further debate".

It recommends that, in its response to the report, the Government "...sets out its assessment of which policing roles could appropriately be undertaken by private investigators and which should not; how it believes cuts to police funding will affect the involvement of private investigators in law-enforcement; and what part private investigators will have in the new landscape of policing."

• Your Expert Witness has frequently reported on the role of private investigators in gathering evidence for litigation, often also providing expert witness services. A number of members of both the Association of British Investigators and the Institute of Professional Investigators can be found in its directory.