Here's the background of my specific case. The director of a department suspects that an employee is playing video games at work. This problem is aggravated by the fact that the department is understaffed right now, and work is pilling up. I had another employee of the same department come to me with the same suspicions, motivated by the fact that the low output of his coworker is making him have to work harder. He claims that he sees weird flashes in his monitor sometimes, but every time someone gets close he switches to work related windows.
After hours, his boss was snooping around on his PC and he asked me for help. We found Diablo 3 installed, and browsing history of a few dating sites. Now he's asking me to monitor his activity to get concrete data about the frequency of those activities.
I have two concerns going forward. One is legal, but that's off-topic here; the other is about my relationships with those people at work. I've been told not to talk with him about this matter before we have concrete data, which means that by trying to solve this issue having a conversation with the employee, I'd be going against direct instructions (plus, the employee could take offense if he thinks the accusation is unfounded); on the other hand, by monitoring him and forwarding all the results to his boss, he'd probably feel betrayed when he realizes the past week I've been gathering that data behind his back that could potentially get him fired, while at the same time interacting with him as if nothing was happening.
I should add that, even though we don't usually hang out, I like the guy, which makes this much more difficult and uncomfortable for me.