My grandfather was an elder since the arrangement began and they followed people suspected of “wrongdoing”, until the Society told them to “stop policing the flock”. So it did used to go on. He followed the Theocratic Ministry School conductor into a gay bar and found him holding hands with another man. He followed another person suspected of having an affair with his sectary, but they never found anything incriminating.
Even years after this, my grandfather teamed up with a non-JW he studied with for years, who suspected his JW wife was having an affair. Of course, all this was not sanctioned by the elders.
Unlike Scientology, the Watchtower is very legally savvy, perhaps due to getting in trouble in the past (like the case with the Greek Branch). They know how to dance the line and stay just within what they are legally permitted to do. They also have no problem letting elders fall on their swords and absolving any responsibility.
Of course, Watchtower really doesn’t need elders to stalk people anymore. The informing system among the members ensures there are eyes and ears everywhere. A person is not safe even with JW family…the least bit of dissent can be reported and put a person on the elder’s radar.