Most of the ex-agents' activities, from surveillance to lie detection, are perfectly legal. In the wake of the 2006 Hewlett-Packard scandal, detectives used pretexting to obtain the private telephone records of company directors, employees, and journalists. In an effort to track leaks to the media, federal law was tightened to prohibit using fraudulent means to obtain telephone records. Financial records were already off-limits. But federal law doesn't forbid assuming a false identity to get other information—an area that ex-spies exploit.

Still, a few techniques favored by the spies-for-hire do appear to violate privacy statutes. One of these involves using "data haunts," extreme methods of electronic monitoring such as tracking cell-phone calls and gathering emails by relying on secretly installed software to record computer keystrokes. An ex-C.I.A. agent described a group of his former colleagues who set up shop offshore so that they could tap into telephone calls—a practice prohibited by federal law—outside U.S. jurisdiction. "They call themselves the bad boys in the Bahamas," he said.

Even some of the legal methods are controversial within the industry. Certain old-school firms won't stoop to dumpster diving or stealing garbage—which is usually legal as long as the trash is on a curb or other public property—because they consider it unethical. They say that the prevalence of former intelligence agents in the field and the rise of unscrupulous tactics have tarnished a business that often struggles with its reputation. One longtime investigator complained that he recently lost business to some ex-C.I.A. officers who promised a potential client that they could obtain the phone and bank records of a target—something that is illegal in most cases.

The investigator told me that nearly every major security firm employs ex-agents, though most don't break the law.
"But plenty of people are worried about the potential damage to all of us when someone gets caught," the investigator says.

Penetrating the secret world of corporate espionage has never been easy, and spies are trained to leave no tracks. Still, when disputes like the Wal-Mart case become public, it's increasingly likely that former intelligence officers are lurking in the background. For instance, in March 2007, Oracle, the software company, filed suit in San Francisco federal court against German rival SAP, accusing it of systematically and illegally downloading thousands of pieces of proprietary software. According to a source involved in the case, Oracle's documentation featured an analysis by forensic computer experts who used to do top-secret work for the federal government. SAP's chief executive, Henning Kagermann, acknowledged in July that "inappropriate downloads" had occurred, although he maintained that Oracle was not seriously harmed. The suit is pending.