The UK’s Information Commissioner says she will seek a warrant to look at the databases and servers used by British firm Cambridge Analytica.
The London-based company is accused of using the personal data of 50 million Facebook members to influence the US presidential election in 2016.
Its executives have also been filmed by Channel 4 News suggesting it could use honey traps and potentially bribery to discredit politicians.
The company denies any wrongdoing.
On Monday, Channel 4 News broadcast hidden camera footage in which Cambridge Analytica chief executive Alexander Nix appears to suggest tactics his company could use to discredit politicians online.
In the footage, asked what “deep digging” could be done, Mr Nix told an undercover reporter: “Oh, we do a lot more than that.”
He suggested one way to target an individual was to “offer them a deal that’s too good to be true and make sure that’s video recorded”.
He also said he could “send some girls around to the candidate’s house…” adding that Ukrainian girls “are very beautiful, I find that works very well”.
Mr Nix continued: “I’m just giving you examples of what can be done and what has been done.”
Channel 4 News said its reporter had posed as a fixer for a wealthy client hoping to get a political candidate elected in Sri Lanka.
However, Cambridge Analytica said the report had “grossly misrepresented” the conversations caught on camera.
“In playing along with this line of conversation, and partly to spare our ‘client’ from embarrassment, we entertained a series of ludicrous hypothetical scenarios,” the company said in a statement.
“Cambridge Analytica does not condone or engage in entrapment, bribes or so-called ‘honeytraps’,” it said.
Mr Nix told the BBC’s Newsnight programme that he regarded the report as a “misrepresentation of the facts” and said he felt the firm had been “deliberately entrapped”.
UK Information Commissioner Elizabeth Denham is investigating Cambridge Analytica over claims it used personal data to influence the US presidential election.
Christopher Wylie, who worked with the company, claimed it amassed the data of millions of people through a personality quiz on Facebook that was created by an academic.
Ms Denham demanded access to the firm’s databases and servers after it missed her Monday deadline.
“I’m not accepting their response so therefore I’ll be applying to the court for a warrant,” she told Channel 4.
She said she wanted to understand how data was “processed or deleted by Cambridge Analytica”.
Cambridge Analytica insists it followed the correct procedures in obtaining and using data, but it was suspended from Facebook last week.
Facebook, meanwhile, will hold an open meeting with its employees later to discuss the matter, tech news website The Verge is reporting.
Facebook said it has hired its own digital forensic team to audit Cambridge Analytica.
“This is part of a comprehensive internal and external review that we are conducting to determine the accuracy of the claims that the Facebook data in question still exists,” the firm said.
“If this data still exists, it would be a grave violation of Facebook’s policies and an unacceptable violation of trust and the commitments these groups made.”
Facebook said Aleksandr Kogan, the creator of the personality app from which the data had been harvested, had agreed to be audited, but Mr Wylie – who made the claims about the way the data was gathered and used – had declined.