Gangmasters banned from agriculture are moving into other industries, such as construction and care homes, investigators have discovered.
People who supply agriculture labourers require a licence
BBC Radio 4's Farming Today has been told that a legal loophole has allowed firms which have been refused licences to move into unregulated sectors.
A dossier is being compiled by the Gangmaster Licensing Authority (GLA), and will be passed to the government.
The GLA was set up after 21 cocklers died in 2005 at Morecambe Bay.
Its aim is to stamp out unscrupulous gangmasters who exploit workers - often migrant workers - particularly in the food processing and agricultural industry.
The loophole came to light when the GLA investigated seven companies supplying workers to a firm of vegetable growers.
One of the companies had its licence taken away immediately, and the other six had theirs revoked but were given leave to appeal - three appeals are still continuing.
But Mike Wilson, chief executive of the GLA, said there was clear evidence that two businesses whose licences had been removed had entirely legally moved into unregulated sectors.