An administrative agency needs to have explicit authority by statute to conduct investigations.  The agency derives this authority from statutes.  Such investigations should be within the authority given by the statutes.  The investigation includes an investigative process, requirement of a report, and inspection.  The Federal Administrative Procedure Act provides that the investigative acts and demands may be issued, made and enforced only as per the procedures laid down by law.

Further, it is necessary that the governing statute must grant the administrative agency the power to investigate.  Also the purpose of such investigation should be one authorized by the legislature.  That is, there must be authority, relevancy and some basis for the act that is investigated.  Any investigation exceeding the authority given shall be in violation of the provisions.  In Resolution Trust Corporation V. Leopold H. Greif, Ralph E. Lewis, And James W. Sight, (906 F. Supp. 1446), the respondent officers sought to quash subpoenas from an administrative agency contending that they were issued seeking irrelevant information.  The court held that an administrative subpoena is valid if the inquiry is within the authority of the agency and that the information is relevant.  The court further held that the agency need not prove the fact of “relevancy”; instead the burden lies on the party challenging to prove that the information sought is irrelevant.  The court, in United States v. Oncology Service, 60 F.3d 1015, 1020 (3d Cir. 1995), has laid down what is meant by “reasonably relevant”.  “Reasonably Relevant” means the information must be relevant to some or any of the inquiry conducted by the administrative agency.

Any investigation exceeding the authority given shall be in violation of the provisions.  In People v. McWhorter, 113 Ill. 2d 374, 380 (Ill. 1986), the court observed that an administrative investigation violates due process if it is conducted arbitrarily or in excess of statutory authority or undertaken for an improper purpose, such as to harass.