Investigators have been granted a search warrant to access Cambridge Analytica's offices.
Eighteen officers working for the Information Commissioner have entered the firm's premises in central London.
They are seeking access to the company's records amid claims it used illegally acquired data from Facebook to influence political campaigns.
Both Cambridge Analytica and Facebook deny any wrongdoing.
The data company's chief executive Alexander Nix has been suspended while Facebook founder Mark Zuckerberg has been called on to give evidence to MPs.
Facebook could face fines of up to £1.1 billion from May if it is found to have broken the rules, Culture Secretary Matt Hancock said at a Westminster lunch earlier this week.
New powers in the Data Protection Bill mean that the Information Commissioner can levy fines of up to 4% of global turnover on social media platforms.
"The Bill also means that people will have the right to move all their data wholesale from one social network to another," he added.
"So from May if people lose trust in a social media platform they can move to another one at the click of a button.
"This will concentrate minds."