Government cuts to police budgets have been blamed for residents turning to private security firms to patrol their streets.
Middlesbrough-based business John Watson Security Ltd (JWS) has appeared on national TV and newspapers after launching on Teesside in recent weeks.
The firm is set to expand to Hartlepool soon.
Local politicians have raised concerns about the use of private security firms in tackling crime.
Hartlepool MP Mike Hill said it was a worrying, but predictable, development – adding that in the last seven years Government funding to Cleveland Police has fallen in real terms by 39% resulting in 450 fewer officers and 50 PCSOs.
He said: “The truth is that police funding has been hammered by the Government under their austerity agenda and we are now seeing the results.
“The reality is that seven years ago we wouldn’t even be looking at this scenario, but now because police budgets have been hit so hard the reality is that there are just not enough bobbies on the beat and the police are no longer as visible as they used to be.”
JWS charges households £13 a year to be included in patrols based on a take-up of about 60% of a street.
John Watson said: “I have had lots of requests from Hartlepool. The crime rate has just gone through the roof.
“The police are doing a fantastic job but they haven’t the manpower.
“When I go out on patrol I hardly see one cop car. It is because of the Government. I’m filling that gap. There is a demand for it.”
Jason Harwin, Cleveland Police assistant chief constable, said of private security firms: “Individuals won’t have the powers, training, accreditation and equipment to perform the role that police are empowered to do.”
Cleveland’s Police and Crime Commissioner Barry Coppinger said he shared MPs’ concerns.
He said: “It is important that such firms carry out effective checks as to the suitability of anyone employed in this work and that staff are properly trained and licensed where appropriate, this is something the Government needs to ensure nationally as a matter of urgency.
“Most important of all is that the Government reverses its cuts to police funding so we can put more officers on patrol.”
The Home Office said it is putting up to an extra £450million into police funding this year.
Cleveland’s share is up 2.2% to £125.4million.