Security Executive - Oct/November 2006

O C T O B E R / N O V E M B E R 2 0 0 6

W W W . S E C U R I T Y E X E C U T I V E . O R G

SECURITYA P U B l I C A T I O N O F T h E N A T I O N A l A S S O C I A T I O N O F S E C U R I T Y C O M P A N I E S

EXECUTIvEWINGING

IT IS ThE AVIAN FlU ThE NEXT PANDEMIC? IS YOUR BUSINESS PREPARED?

A l S O I N S I D E …

> S P E C I A l R E P O R T : A S I S 2 0 0 6 1 0

> A F E R T I l E E N V I R O N M E N T F O R S U B C O N T R A C T I N G 1 8

> l E G I S l A T I V E U P D A T E 2 0

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O C T O B E R / N O V E M B E R 2 0 0 6 • V O l U M E 1 , N O . 3

W W W . S E C U R I T Y E X E C U T I V E . O R G

E D I T O R I A l

PublisherJoseph Ricci, CAE

[email protected]

EditorJennifer Sikorski

[email protected]

D E S I G N & P R O D U C T I O N

Art DirectorJacki Silvan

[email protected]

A D V E R T I S I N G S A l E S

Joan [email protected]

B O A R D O F D I R E C T O R S

Chair: Martin Herman, Special Response Corporation1st Vice Chair: Heather O’Brien, Security Forces, Inc.

2nd Vice Chair: James McNulty, Securitas Security Services USA3rd Vice Chair: Stephen I. Kasloff, Guardsmark, LLC

Treasurer: Lynn C. Oliver, American Security Programs, Inc.Secretary: Robert Kilbride, The Wackenhut Corporation

Director-At-LargeDennis Roberts, SecTek

Executive Director: Joseph Ricci, NASCOPast Chair: G. R. Massimei, U.S. Security Associates, Inc.

Security Executive is published bimonthly by the National Association of Security Companies (NASCO), the nation’s largest contract security trade association. Security Executive is designed to provide practical information on all aspects of security management. Subscription rates: Free for members and non-members in the U.S., Mexico and Canada; $45 for international members; $55 for international non-members. Security Executive content may not be photocopied, reproduced or redistributed without the consent of the publisher. Copyright 2006. All rights reserved.

Security Executive is distributed to more than 5,000 decision-makers at nearly 3,000 contract security companies.

Opinions or statements of authors and advertisers appearing in Security Executive are their own and do not necessarily represent the opinions or statements of NASCO, its board of directors or NASCO staff.

Security Executive welcomes article submissions and reader feedback. Articles and comments may be e-mailed to [email protected]. Include your full name, address and phone number.

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Table of Contents

O C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R G1

cover Photograph: Jean schweitzer | agency: Dreamstime

A Fertile environment for SubcontractingAs the practice takes hold of the industry, take care to avoid insurance snafus.

By Mike Lehner18

Winging ItIs the avian fl u the next pandemic? Is your business prepared?

Prepared by CRI’s WAIS12

FEATURES

IN EVERY ISSUE

2 Calendar of Events4 In the News HoT ToPIc: Companies Plan for Avian Flu Pandemic, but

Outcomes Remain Uncertain

bUSINeSS FocUS: Mergers, Acquisitions to Continue

PArTNerING UP: AlliedBarton Joins Corporate Partnership Program to Support IACLEA, Campus Public Safety

bUSINeSS beST: ARES International Security Ranks No. 47 on 2006 Inc. 500 Fastest Growing Companies

UNIoN PrIorITIeS: Union Takes Issue with Fitness Rules for Nuclear Plant Guards

From THe HILL: Bush Signs Defense Authorization

cHANGING FocUS: Kroll Looks to Sell Security Subsidiary, Focus on Consulting and Training

8 NASCO News boArD rePorT: NASCO Elects Board of Directors

member beNeFITS: NASCO Launches Database of State Licensing, Private Security Regulation

eveNT HIGHLIGHT: First NASCO/FPS Working Group Scheduled for Nov. 29

SPecIAL rePorT: NASCO Contract Security Breakfast Attracts Nearly 100 Senior Contract Secuirty Leaders

20 Legislative Updates

O C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R G�

November 27–December 1The 4th International Aviation Security Technology SymposiumWashington, D.C. www.sskies.org/symposium.htm

November 15–16Securing New GroundNew York, N.Y. www.securingnewground.com

November 15–16OSAC 2006 Annual BriefingWashington, D.C.www.osac.gov

November 8–9CALSAGA 2006 Annual ConferenceTemecula, Calif. www.calsaga.org

November 29NASCO FPS Working GroupWashington, D.C. www.nasco.org

December 4–6ASIS International Middle East Security Conference & Exhibition 2006The Kingdom of Bahrain www.asismiddleeast.com

December 6–8ASIS International Security Force ManagementSt. Pete Beach, Fla. www.asisonline.org/store/program_ detail.xml?id=12322583

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In the news

BUSINESS FOCUS

The majority of global corporations have

developed, or are developing, detailed avian

fl u pandemic readiness plans, according to a

report from The Conference Board. Nearly

three-fourths of the 553 responding global

companies either have a plan or are well into

developing one, and 85% of survey partici-

pants began their planning efforts within the

past 12 months.

Large and publicly held companies appear to

be the most advanced in their preparations for

a possible avian fl u pandemic. Approximately

95% of companies with more than $5 billion

in sales either have an up-to-date prepared-

ness plan or are in the process of planning.

But 65% of companies with less than $100

million do not yet have any plans specifi cally

in place addressing the impact of an infl uenza

pandemic.

companies Plan for Avian Flu Pandemic, but outcomes remain Uncertain

HO

T TO

PIC

95%OF COMPANIES WITH more THAN $5 bILLIoN IN SALES EITHER HAVE OR ARE IN THE PROCESS OF PLANNING

65%OF COMPANIES WITH LeSS THAN $100 mILLIoN DO NOT HAVE ANY PLANS IN PLACE

The B

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report that they will activate their plan when

the World Health Organization (WHO)

declares Alert Level 4 (increased human-to-hu-

man transmission). Eighteen percent said that

their plan will go into effect when a pandemic

situation is declared in a country where their

organization has an operating presence; while

15% simply don’t know.

The Conference Board survey and other

similar reports have not addressed business

concerns regarding security, especially the loss

of security due to offi cer illness and coordina-

tion between law enforcement, emergency

response and private security, the primary

elements of fi rst-response. If you have case

studies, plans or information you would like

to share concerning your contract security

fi rm’s planning, coordination and communi-

cation for pandemic response, please e-mail

them to [email protected]. For more on avian

fl u, see “Winging It” on page 12. n

According to The Conference Board report,

the most signifi cant disadvantage in not

conducting formal pandemic preparedness

planning may be the virtually total absence of

coordination with the public sector. An over-

whelming 94% of participating companies

report that they have not discussed with any

level of government offi cials their organiza-

tions’ ability to provide essential services or

access to facilities, equipment or staff during

a pandemic.

In the event of a pandemic, companies are

most concerned about the health and welfare

of employees (98%), operational continuity

(96%) and their telecommuting capabilities to

enable employees to work from home (93%).

There doesn’t seem to be a strong consensus

on any specifi c criterion that would activate

an organization’s pandemic preparedness plan.

Close to one-third of the survey participants

The G

OOd…

mergers, Acquisitions to continueAccording to recent surveys and discussions, leading security industry experts and market watchers expect mergers and acquisitions to continue to boom, creating opportunities for the physical and technology security markets.

The recent acquisition of Initial Security by Allied Barton and the merger of Andrews International and Copstat Security have fur-ther fueled interest in increasing revenues and growing market share through M&A. Results

of a recent ACG/Thomson survey indicate that the main objectives of M&A is to increase revenues and profi tability (46%) and grow market shares (35%). Other objectives include new market entry, expanding geographic reach, adding new services and obtaining management strength.

Emphasis continues to focus on midsized and niche companies, such as disabled-veteran and 8-A fi rms serving the federal and state

markets. In addition to the largest company participation in the M&A market, many larger regional companies are looking to expand their geographic reach and are seeking acquisitions and mergers that provide new market access. n

O C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R G

PA

RTN

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ING

UP Alliedbarton Joins corporate Partnership Program

to Support IAcLeA, campus Public Safety NASCO member AlliedBarton Security Services

has become a corporate partner of the Interna-

tional Association of Campus Law Enforcement

Administrators, Inc. (IACLEA), under a new

program developed to honor IACLEA’s 50 years

of service and to support initiatives to enhance

the ability of campus public safety to protect

higher education institutions in the future.

AlliedBarton is a Titanium Sponsor and, as

such, has pledged a signifi cant donation to

support IACLEA’s 50th anniversary and future

initiatives. The goals of IACLEA’s corporate

partnership program are to highlight the growth

and importance of campus public safety and to

support initiatives to strengthen campus public

safety and expand its impact on higher educa-

vided quality security services and highly trained

personnel to clients in a number of industry

sectors, including commercial real estate, higher

education, healthcare, government, residential

communities, manufacturing and distribution,

fi nancial institutions, shopping centers and

other commercial facilities.

IACLEA is an association that advances campus

public safety for its more than 1,000 educa-

tional institution members and 1,500 individual

professional members by providing educational

resources, advocacy and professional develop-

ment services. n

tion and its service to stakeholders worldwide.

IACLEA will celebrate its 50th anniversary with

a series of events, beginning in Las Vegas in

2007 and culminating with its 50th Annual

Conference and celebration in Hartford, Conn.,

in 2008.

AlliedBarton Security Services, headquartered

in King of Prussia, Pa., is the largest American-

owned and managed security services fi rm in the

United States. Since 1957, AlliedBarton has pro-

BUSINESS BEST

Inc. magazine recently announced its 25th annual

Inc. 500 ranking of the fastest-growing private

companies in the country. Government security

services company ARES International Security

ranks No. 47 on the list, with three-year growth of

1,198%. ARES is the only contract security com-

pany recognized in the Inc. 500 Fastest Growing

Companies list for 2006.

The 2006 Inc. 500, published in the September

issue, reports the most robust bunch of companies

the magazine has ever compiled, with aggregate

revenue of $19.7 billion, up from $16.5 billion

last year and $12.9 billion in 2000. ARES’ 2005

annual revenues of $25.9 ranked it as 47th on the

list of 500 companies across the nation.

The 2006 Inc. 500 list measures revenue growth

from 2002 through 2005. To qualify, companies

had to be U.S.-based, privately held independent

(not subsidiaries or divisions of other companies)

as of Dec. 31, 2005, and have at least $600,000

in net sales in the base year.

ARES is a SBA 8(a) certifi ed service disabled,

veteran-owned, small disadvantaged, Ameri-

can-owned fi rm that specializes in providing

armed/unarmed security offi cers, canine explo-

sive detection, classifi ed couriers and technical

security services to the federal government. It

employs more than 950 security professionals

in seven U.S. states and internationally. n

1 Litle & Co.2 Airborne Health3 Digital Lifestyle

Outfitters4 Edible

Arrangements International

5 SUNRx6 United Bank Card

7 Method Products8 StubHub9 Ancillary Care

Management10 MemberHealth11 Advanced

Equities Financial12 Silver State

Helicopters

13 NetShops14 PatchLink15 Global

Performance16 Bandwidth.com17 Mercer Staffing18 Immediate-Care19 Evolve

Manufacturing Technologies

20 Visionary Solutions

21 The Macaluso Group

22 OpenPages23 Booyah Networks24 LanceSoft25 Video Gaming

Technologies26 WageWorks

27 C&B Services28 Resurgence

Financial29 Interactive

Technology Solutions

30 Clear Capital31 Advanced

Planning Services32 Valley Healthcare

Systems

33 Sirius Solutions34 The Insitu Group35 OneWayFurniture.

com36 TIC Properties37 VeriStor Systems38 Wendel Energy

Services39 DataSynapse

40 Merlin Technical Solutions

41 Speck Products42 Kurtzman Carson

Consultants43 NightHawk

Radiology Services

44 Bell-Corley Construction

45 Group946 Everything

Furniture47 AreS

INTerNATIoNAL SecUrITY

48 Study Island49 The Experts50 Attic Technologies

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Inc. Magazine’s top 50…

BUSINESS BEST

ARES is a SBA 8(a) certifi ed service disabled,

AreS International Security ranks No. 47 on 2006 Inc. 500 Fastest Growing companies

5


In the news

Two years ago, the Energy Department announced plans for creating “a special elite

federal force” to protect high-priority nuclear plants. After 18 months of study, it

implemented a policy that created combat teams to protect against and engage poten-

tial terrorists or other adversaries outside a nuclear weapons plant rather than waiting

for attackers to penetrate the gates.

These elite combat units currently work for companies that operate Energy Depart-

ment plants or security contractors, such as NASCO member Wackenhut, that provide

guards and security offi cers.

The demands of these positions protect the United States’ critical infrastructure,

including Energy Department plants and facilities that use nuclear weapons mate-

rial such as plutonium and highly enriched uranium. These facilities are expanding

the number of security jobs covered by rigorous physical fi tness standards critical to

improving security.

A department offi cial said contractors should be able to reassign offi cers who do not

meet the fi tness standards for “offensive combative” positions into less demanding jobs.

The Energy Department is not interested in exploring whether the offi cers should be

“federalized.”

Bryan Wilkes, spokesman for the department’s National Nuclear Security Administra-

tion, said no compelling reason was found that justifi ed converting the offi cers into

federal employees. “What we have is working great,” he says.

But the National Council of Security Police, a union group representing offi cers at

nuclear facilities, thinks the department’s plans will undercut the goal of enhanced

security in the post-Sept. 11 world.

In the past, nuclear weapons plants have assigned offi cers to offensive and

defensive positions. The Energy Department’s policy shift is prompting

plants to realign their security posture and convert more positions to the

offense, union offi cials said.

For the offensive positions, a security offi cer must run a mile in eight

minutes and 30 seconds and complete a 40-yard dash in no more

than eight seconds. Defensive positions require a half-mile run in

four minutes, 40 seconds, and a 40-yard dash in 8.5 seconds.

Union offi cials believe the physical fi tness standards do not

take into account a person’s age or sex, and that subsequently

hundreds of offi cers will not meet the standards for of-

fensive positions.

Most contractors believe many older offi cers and female

offi cers “are fully capable” of meeting the physical standards and

jobs are being identifi ed for offi cers who do not meet the fi tness

standards. n

UNION PRIORITIES

On Oct. 17, President Bush signed into law an extension

of the temporary authority for contractor performance of

security guard functions as part of the larger $532.8 billion

defense appropriations bill.

The bill amends Section 332(c) of the Bob Stump

National Defense Authorization Act for Fiscal Year 2003,

extending authorization for contracting guard services at

military installations through Sept. 30, 2009. However,

the law begins phasing out contract security by limit-

ing the total number of personnel employed to perform

security guard functions, effectively reducing the contract

security force by 10% each year.

In addition, the law requires the secretary of defense to

submit by Feb. 1, 2007, a report on contractor perfor-

mance of security guard functions to the Committee on

Armed Services of the Senate and the Committee on

Armed Services of the House of Representatives.

The report will include the following:

• An explanation of progress made toward implement-

ing the seven recommendations in the comptroller

general’s report, “Contract Security Guards: Army’s

Guard Program Requires Greater Oversight and Reas-

sessment of Acquisition Approach” (GAO-06-284).

• An assessment, taking into consideration the comp-

troller general’s observations on the Department of

Defense’s November 2005 report, “Department of

Defense Installation Security Guard Requirement

Assessment and Plan,” of the following:

1. The cost-effectiveness of using contractors rather

than Department of Defense employees to per-

form security-guard functions.

2. The performance of contractors employed as

security guards compared with the performance

of military personnel who have served as security

guards.

3. Specifi c results of on-site visits made by offi cials

designated by the secretary of defense to military

installations using contractors to perform secu-

rity-guard functions. n

bush Signs Defense Authorization

FRO

M T

HE H

ILL

Union Takes Issue with Fitness rules for Nuclear Plant Guards

In the past, nuclear weapons plants have assigned offi cers to offensive and

defensive positions. The Energy Department’s policy shift is prompting

plants to realign their security posture and convert more positions to the

For the offensive positions, a security offi cer must run a mile in eight

minutes and 30 seconds and complete a 40-yard dash in no more

than eight seconds. Defensive positions require a half-mile run in

four minutes, 40 seconds, and a 40-yard dash in 8.5 seconds.

Union offi cials believe the physical fi tness standards do not

take into account a person’s age or sex, and that subsequently

offi cers “are fully capable” of meeting the physical standards and

jobs are being identifi ed for offi cers who do not meet the fi tness

In the news

CHANGING FOCUS

Kroll, the risk consulting and technology division of

Marsh & McLennan Companies Inc., is seeking buy-

ers for its subsidiary, Kroll Security International, that

provides security services in Iraq and Afghanistan to

focus on consulting and training according to Simon

Freakley, Kroll chief executive.

Kroll Security International currently accredited sub-

contractors in Iraq and according to Freakley Kroll has

been “speaking to high-quality companies that do this

work and have expressed an interest in purchasing that

subsidiary and taking over the activities.”

The issue during insurance brokerage Marsh &

McLennan’s most recent earnings report that stated

Kroll planned to leave high-risk international assign-

ments that no longer fi t its business strategy. Later

clarifying the statement was referencing operation and

security personnel in Iraq and Afghanistan.

During the past year, Kroll has acquired several

“successful, best-of-breed companies that provide a

competitive advantage and secure Kroll’s leadership in

key markets” said Freakley, including InfoLink Screen-

ing Services, Inc., a leading, privately-held back-

ground screening company now operating as Kroll’s

Background Screening West Coast offi ce. Demands

for consulting and training continue to rise due to

new legislation and concerns about workplace security.

In addition to backgrounds, Kroll provides employee

background checks and related services such as drug

testing, Form I-9 employment eligibility verifi cations,

and pre-employment physical examinations.

Two KSI workers were killed in Iraq in January 2005.

Another Kroll employee died in December 2005, the

company said. After Kroll Security International is

transferred, Kroll security will focus on consulting

and training, with some security services provided for

corporate or individual clients. n

© 2006 The Associated Press

Kroll Looks to Sell Security Subsidiary, Focus on consulting and Training

7


nAsCo Update

NASCO recently concluded its board and general

membership meetings in Alexandria, Va., electing

its board, approving its budget and operational

plan for 2007 and setting its legislative agenda (see

“Legislative Update” on page 20).

NASCO membership elected Martin Herman as

chair for a two-year term. Herman is president of

Special Response Corporation, a national leader

in providing highly specialized security services in

times of crisis or heightened vulnerability. Herman

has guided Special Response Corporation through

more than 1,700 security-related deployments.

He has formulated security contingency plans for

hundreds of Fortune 500 companies, small busi-

nesses and public agencies facing crisis situations

ranging from homeland security threats to natural

and manmade disasters. An expert in crisis and

emergency security, Herman serves as serves a

consultant on these topics.

In addition, the NASCO members elected:

• Vice Chair—Heather O’Brien, executive vice

president, Security Forces

• 2nd Vice Chair—Jim McNulty, executive vice

president, Securitas Security Services USA

• 3rd Vice Chair—Stephen Kasloff, vice presi-

dent, Guardsmark

• Treasurer—Lynn Oliver, president, American

Security Programs

• Secretary—Robert Kilbride, vice president

and associate general counsel, The Wackenhut

Corporation

• Member-at-Large—Dennis Roberts, chief

operating offi cer, SecTek

Each elected offi cer serves a two year term begin-

ning at the conclusion of NASCO’s Oct. 18

general membership meeting except the treasurer,

whose term ends Dec. 31, and the past chair,

Rick Massimei, special consultant at U.S. Secu-

rity Associates, which as a non-elected position. n

NASco electsboard of Directors

BO

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T

The states conduct the majority of private security service regulation, with

40 states requiring licensing of security companies and security offi cer reg-

istration. Conducting business in multiple states and maintaining compli-

ance requires frequent contact with each state’s regulatory offi ce and visits

to their Web sites. The new NASCO State Private Security Licensing and

Regulatory Database captures and reports, by state, more than 50 regula-

tory variables ranging from general licensing and registration requirements

to background checks, number of hours of training, armed vs. unarmed,

length of license, reciprocity and liability and insurance coverages. This

one-of-a-kind database is also searchable by each of these categories, pro-

viding companies with an excellent snapshot of the requirements for the

states they operate—or wish to operate—in.

The database is available to NASCO members at www.nasco.org. The

database will help you:

1. Save time. Responsibilities for maintaining state regulatory informa-

tion will require fewer resources for your company to review and

maintain, allowing for more time committed to the business of

contract security.

2. Increase access to information. The Web-based tool is constantly up-

dated and available for multiple users from any Internet connection.

3. Reduce risk and simplify compliance. Quick reviews of state

requirements are only a few clicks away and instant access to the ap-

plicable legal requirements by jurisdiction can reduce your risk of fi nes

and potential civil damages.

4. Simplify research. Query capabilities enable users to retrieve current

statistics on private security licensing, registration, screening and train-

ing requirements for easy comparisons between states requirements. n

Martin

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NASco Launches Database of State Licensing, Private Security regulation

MEMBER BENEFITS

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O C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R GO C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R G

9O C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R G

First NASco/FPS Working Group Scheduled for Nov. 29 Senior security executives representing NASCO

government security contractors will begin

working with Fred Muccino, Federal Protective

Service (FPS) chief inspector for guard force

operations, to address FPS-related communica-

tions and initiatives such as contract and site

requirements, validation and training.

The Department of Homeland Security’s FPS

employs more than 14,000 contract security

offi cers and provides law enforcement and

security services to more than 1 million tenants

and daily visitors to federally owned and leased

facilities nationwide. FPS’ protection services

require close coordination and intelligence

sharing with the investigative functions within

DHS, which is itself relying more on private

security’s assistance.

The NASCO FPS Working Group will work to

identify and validate security offi cer require-

ments, as well as develop training to sup-

port these requirements. Any NASCO

member representatives interested

in participating should contact

Joseph Ricci at 703-518-1479;

[email protected]. n

100%Military & Police Experience.

www.specialresponse.com4 1 0 . 7 8 5 . 1 2 1 2www.specialresponse.com

When your company is faced with a crisis, whether man-made or natural; trust the experts in security and executive protection: Special Response Corporation, where every security officer has extensive military or police experience... And every one is a security specialist.

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EVENT HIGHLIGHT

NASCO Contract Security Breakfast Attracts Nearly 100 Senior Contract Security Leaders

Nearly 100 contract security leaders attended the

NASCO Contract Security Breakfast, held during

the recent ASIS Annual Seminar in San Diego, to honor

long-time private security leader Don Walker, chairman of

Securitas Security Services, and listen to insight from Paul

Johnson, California’s chief of the Bureau of Security and

Investigative Service. ASIS International President Jeff Spivey,

accompanied by ASIS International Executive Director

Michael Stack, welcomed NASCO’s guests.

Walker was presented with the prestigious Colonel Edgar B.

Watson Award for his contributions to private security and

tireless efforts to raise the standards for contract security.

Upon receipt of the honor, Walker called for the security

industry “to do more” to professionalize private security,

including improving security offi cers’ wages and benefi ts.

“We’ve only started to raise the standards; we have a long way

to go,” Walker said.

Johnson discussed his state’s initiatives to assist private secu-

rity in raising standards through licensing, training and com-

pliance. He outlined his efforts during the past few months to

increase the importance of—and need for—qualifi ed private

security personnel nationwide. “Because private security

protects nearly 90% of the nation’s critical infrastructure,”

Johnson said, “industry standards need to be put in place

immediately.”

Walker and Johnson’s statements further reinforce NASCO’s

mission and efforts to promote higher standards and sustain

professional integrity and competence throughout every

aspect of private security business. n

ASIS INTERNATIONAL 2006

The securiTy

indusTry [should]

“do more” To

professionaliZe

privaTe securiTy,

including

improving

securiTy officers’

wages and

benefiTs.

10

11O C T O B E R / N O V E M B E R 2 0 0 6 • S E C U R I T Y E X E C U T I V E . O R G

JoSePH rIccI, cAeRicci is executive director of the National Association for SecurityCompanies (NASCO).

Incoming NASco vice President Martin Herman presents outgoing NASCO Chair Michael Goodboe, Ph.D., with a plaque for his outstanding leadership and direction.

Don Walker accepts the NASCO Colonel Edgar B. Watson Award with wife Mary and daughter Kathryn.

ASIS International President Jeff Spivey welcomes NASCO Private Security Breakfast attendees to the ASIS Annual Seminar and Exhibits in San Diego.

NASco chair michael Goodboe presents the NASCO Colonel Edgar B. Watson Award to Don Walker, chairman of Securitas Security Services, USA, for his superior leadership and commitment to raising private security standards.

don’t miss nasco at asis international 2007

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to

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Plan noW to be in las VeGas sePtember 24-27, 2007

WINGINGIT

IS ThE AVIAN FlU ThE NEXT PANDEMIC?

IS YOUR BUSINESS PREPARED?

FEATURED ARTICLE : : WINGING IT

Throughout history, every generation has faced a fl u pandemic of

some sort. These pandemics are a natural phenomenon and will undoubtedly continue in the future. With 39 years as the longest interval between pandemics and the current interval at 38, fl u experts warn that an upcoming epidemic is a ticking time bomb.

Concerns have focused on the H5N1 avian fl u, a strain identifi ed as containing pandemic potential since it may ultimately mutate into a strain that is highly contagious among humans. While some argue that the bird fl u threat is merely being sensationalized through the media, historical perspective and the deadly affect of the avian fl u strain on humans who contract the virus indicate that every facet of the world should plan and prepare for the very real threat of an upcoming human fl u pandemic.

According to the U.S. government, a disease pandemic could have a greater impact on a country than a terrorist attack or a natural disaster and could even be comparable in scope to a war. Predictions by the World Health Organization (WHO) back this warning, indicating that a severe fl u pandemic could kill 70 million people worldwide. Such a devastating pandemic could contract the world economy by 3.1%, leading to global economic losses of US$2 trillion.

In recent months, millions of chickens in infected countries have been culled in an

attempt to eradicate the spread of the bird fl u virus. Despite these efforts, the virus has been credited with 151 human deaths since 2003, a toll that is steadily rising. Bird fl u, the origins of which began in East Asia, has now spread deep into Africa, Europe and Asia, and low-pathogenic forms were reported in the Americas in the fall of 2006. Further complicating matters, most nations remain ill-prepared to respond to an epidemic of this sort, despite dozens of warnings from international health experts.

D E A D L y T H R E A T

Avian infl uenza, commonly known as “bird fl u,” is a contagious viral disease that is normally relegated to birds and, to a lesser degree, pigs. Domestic poultry such as chickens and turkeys are particularly susceptible to avian infl uenza viruses. The virus causes a wide variety of symptoms, including a sore throat, cough, fever, pneumonia, respiratory distress or respiratory failure and can result in death. There are about 15 different types of bird fl u, the most contagious of which include variants of the H5 and H7 strains. The current strain causing the most concern is the deadly H5N1 variety, which was discovered among wild birds in South Africa in 1961.

While the number of human infections from the disease has remained relatively low, health offi cials are particularly concerned about the high fatality rate. Between late 2003 and mid-October 2006, there were 256 cases of

the H5N1 strain of fl u in humans reported in 10 countries, 151 of which were fatal. The mortality rate thus far has been approximately 59%. To put this into perspective, the recent Severe Acute Respiratory Syndrome (SARS) outbreak in Southeast Asia had a mortality rate of less than 10%, yet still caused widespread panic. In further comparison, the WHO fears that an avian fl u pandemic could cost up to US$2 trillion dollars and infect 70 million people; SARS cost the economies of the Asia Pacifi c US$40 billion and infected only 8,000 people. The economic damage to Asian economies alone due to outbreaks of the avian fl u last year was estimated at US$8 billion to US$12 billion.

Perhaps most alarming about the current pandemic threat will be the little-to-no notice received around the world if the virus does mutate to an easily transmittable human-to-

1�

WINGINGIT

bird flu, The origins of which

began in easT asia, has now

spread deep inTo africa, europe

and asia and is eXpecTed To

hiT The americas in The near

fuTure. The virus causes a wide

varieTy of sympToms…and can

resulT in deaTh.

did you KnoW?

13



human form. The 1918 to 1919 flu pandemic spread rapidly around the world in an age where global transportation was primarily by steam ship. In today’s world of airplanes and high-speed continental transit, it is highly likely that once the virus makes the jump to humans, it will appear around the world nearly simultaneously.

Scientists have noticed striking similarities between a pandemic likely to result from the H5N1 strain of avian flu and the 1918 to1919 Spanish Flu pandemic. A number of experts believe that the Spanish Flu’s origin may be the same region of China as the H5N1. Further, the Spanish Flu was an avian flu that adapted to humans, precisely what health officials fear with H5N1. Scientific predictions, based partly on

the 1918 to 1919 pandemic, estimate that 100% of the world’s population is likely to be exposed to an upcoming pandemic, 30% of which will contract the flu.

In addition to its origins, the H5N1 strain of avian flu appears similar to the 1918 to 1919 outbreak in its target victims. The Spanish Flu experienced a particularly high fatality rate in individuals aged 18 to 30; thus far, such has also been the case with H5N1 avian flu. A study released by the WHO revealed that younger females are the most likely to become victims of the H5N1 avian flu. The highest proportion of infections since the latest outbreak began in 2003 has occurred in those between ages 10 and 29, and the majority of those infected were females. Out of all reported cases thus far, 90% have infected people under the age of 40. While the overall fatality rate has been 59% since the December 2003 case in Vietnam, infections in individuals between ages 10 and 29 have resulted in an approximately 73% fatality rate.

Public health experts and scientists are increasingly concerned that the H5N1 virus may evolve through mutation or re-assortment and eventually spread from human to human. Officials were extremely alarmed after a cluster of bird flu cases in the North Sumatran village of Kubu Sembeland, Indonesia, appeared to be contracted via human-to-human transmission. Seven out of the eight family members eventually died of the virus. However, the WHO later concluded that thus far, only limited transmission between extremely ill humans has taken place. The organization’s pandemic alert level has remained at 3, meaning there has been “no or very limited human-to-human transmission” of the virus.

A F F E C T E D C o U n T R I E s

Outbreaks of the H5N1 strain of avian influenza have been reported in the following countries since 2003 (human cases have been confirmed in countries are denoted with a “*”): Afghanistan, Albania, Austria, Azerbaijan*, Bosnia & Herzegovina, Bulgaria, Burkina Faso, Cambodia*, Cameroon, China*, Croatia, Cyprus, Czech Republic, Denmark, Djibouti*, Egypt*, France, Georgia, Germany, Greece, Hungary, India, Indonesia*, Iran, Iraq*, Israel/PNA, Italy, Ivory Coast, Japan, Jordan, Kazakhstan, Kuwait, Laos, Malaysia, Mongolia, Myanmar (Burma), Niger, Nigeria, Pakistan, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, South Korea, Spain, Sudan,

Sweden, Switzerland, Thailand*, Turkey*, Ukraine, United Kingdom and Vietnam*.

G L o b A L R E s p o n s E

In May 2005, the 192 members of the WHO approved measures that would give the agency greater power to combat health threats and disease outbreaks. The necessity of heightened powers for the WHO became all the more apparent after the 2003 SARS outbreak in China. Under the new regulations, member countries are required to report any outbreak that could pose a health concern internationally to the WHO.

In addition, the WHO now has the authority to issue recommendations regarding travel restriction, including airport checks and quarantine measures.

The response of world governments to the threat of the bird flu virus has varied widely based on a number of factors including resources, funding and perceived threat. In Southeast Asia, a region that has thus far been hit the hardest by the avian flu virus, the disparity between the preparedness of relatively wealthy and poor nations for a possible pandemic is acutely evident. While countries such as Australia and Singapore are assembling anti-viral drugs and developing inclusive pandemic plans, traditionally poorer countries such as Thailand and Indonesia have struggled to contain outbreaks. Scarce resources, traditionally close interaction between animals and humans and poor surveillance mechanisms to monitor the spread of viruses are all contributing factors that keep the risk of infection high in Southeast Asia. Health officials are concerned that centuries-old farming practices mixed with generally poor health conditions have fostered an environment where the spread of virulent diseases would pose especially dire consequences for a region in which many people live on less than a dollar a day.

World health experts are particularly worried about the bird flu’s affect on Indonesia, the most populated Southeast Asian country in terms of both people and poultry. With an already fragile health care system, a growing population and close contact between animals and humans, the country faces the potential for enormous economic damage and human casualties from a bird flu pandemic. While most other Southeast Asian nations have been able to contain outbreaks, human infections continue to rise in Indonesia, which recently surpassed Vietnam with the highest human death toll from the avian flu in the world. The U.N.’s Food and Agriculture Organization has warned that the virus is rampant among Indonesia’s billions of backyard chickens. Slaughtering is rarely carried out following outbreaks, vaccination is spotty at best and surveillance is weak. Local politicians are often hesitant to implement bird flu policies due to the heavy economic dependence on chickens in small towns and villages. Based on the prior human-to-human transmission case in the country and Jakarta’s seemingly inability to combat the disease, health experts warn that a human pandemic could very well begin in Indonesia.

Analysts are also apprehensive about bird flu outbreaks in China, a nation of about 1.3 billion people whose government has traditionally held a tight lid on its media. China’s vast geographical boundaries, large-pockets of poverty, incompetent medical facilities and colossal bureaucracy have many concerned that news of a viral outbreak affecting humans would be released too late, long after the outbreak started. Such concerns were heightened after it was discovered that the country’s initial human case of H5N1 flu actually took place in November 2003, two years prior to the first case the government

The response

of world

governmenTs

To The ThreaT

of The bird

flu virus has

varied widely


reported to the WHO. Further, a Chinese farmer known as the first “bird flu whistleblower” was imprisoned two months after he reported suspected cases of avian flu in Tianchang City, Anhui Province, to the Ministry of Agriculture in October 2005. While local government officials said that he was complicit with an extortion case that took place two years earlier, many residents suspect he was imprisoned because the local government wanted to “settle scores” with him for reporting the avian flu. His arrest could lead to extreme hesitation by locals to report future cases.

While Asia remains a central focus of concern, even highly developed countries have yet to adequately prepare for an avian flu pandemic. In the United States, the head of the U.S. Agency for International Development described the threat of the H5N1 virus as “the biggest single challenge facing the organization” and recently declared the virus its No. 1 priority. However, a federal audit criticized the Bush administration’s preparations for an avian flu pandemic, saying that the U.S. Department of Agriculture lacks a comprehensive plan for testing and monitoring bird flu in commercial poultry. A U.S. government analysis concluded that most American cities and states remain woefully unprepared for any type of a catastrophe—a serious concern since much of the federal government’s plan to combat a pandemic relies on state and local governments.

Worldwide, a report from the World Bank harshly criticized the response to the threat of an avian flu pandemic. Although international donors pledged US$1.9 billion to assist countries in their fight against the virus at a donor’s conference in Beijing in January 2006, as of July, only US$331 million of the funds had been handed over.

While some of the more wealthy countries have purchased treatments and stockpiled anti-viral vaccines to combat an outbreak of the avian virus, the poorer countries where a pandemic is most likely to occur have struggled to prepare for an outbreak. Experts note that this trend is particularly dangerous because wealthy countries have thus far focused efforts on protecting their home interests first, rather than attacking the virus at the source countries. The amount of resources allocated to virus protection varies greatly from country to country. Indonesia currently has a 10,000 course supply of Tamiflu (made by Swiss-based Roche pharmaceuticals) for a nation of 220 million. Comparatively, the nearby island state of Singapore is amassing a supply of 350,000 doses for its 4.2 million citizens. Should a pandemic occur, it is likely that considerable portions of the world will not have the volume of antibiotics or antivirals available to meet the need, greatly increasing the fatality rate.

countries affected by bird flu

cases confirmed in humans reporTed cases

Illu

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Ion

by

Ja

ck

I s

Ilva

n

16


U.N. officials concede that part of the difficulty in preparing for a pandemic is that it is nearly impossible to predict where the virus may emerge next, as well as how the virus may mutate to become easily transmittable between humans. According to a WHO bird flu expert in Southeast Asia, a clear strategy to confront the avian flu virus has yet to be implemented. While well-developed countries have placed orders for anti-viral drugs, which boost the immune system, these drugs may have little impact against new strains of the flu. As a result of this uncertainty, governments are struggling to implement contingency plans and assign tasks to different agencies.

C o n T I n G E n C y p L A n s F o R b U s I n E s s E s

Just as governments have scrambled to plan for a possible global pandemic, recent data indicates that some companies are moving to incorporate contingency procedures for a bird flu pandemic as well. The quality and operability of such plans varies tremendously, not surprising considering the variety of companies planning for such an event. According to a recent poll by a major U.S. consulting firm, almost 70% of organizations surveyed in 38 countries worldwide responded that a pandemic will have a negative impact on profits. However, only 47% of respondents have established a business continuity plan and only 17% have allocated a budget to deal with pandemic preparedness.

Some companies have modified detailed business continuity plans developed during the SARS outbreak to apply to the avian flu virus. These plans cover how to monitor staff, where and how workers could seek medical treatment and establish a viable way to work from a remote location to limit person-to-person contact. Many businesses are reviewing hygiene requirements concerning the general office environment, air-conditioning systems, ventilation and employee cleanliness. Communication in the event of a pandemic is also a major concern as electricity and telephone lines could potentially be unavailable.

Pandemic planning presents a serious challenge for many businesses as it requires that companies anticipate “waves” of infections that last for two or three months, often times followed by a repetition of infections months later. A flu pandemic could easily impact up to two-thirds of the workforce while business operations continue in an elevated risk environment. The likelihood of significant shortages of essential goods and the cessation of essential services will increase directly with the severity of the pandemic as outside delivery companies lose staff as well. Security risks to facilities thought to contain essential items will increase exponentially at the very time those facilities are least capable of maintaining security due to a lack of personnel as panicked populations seek to acquire the supplies. As pandemics by nature typically affect entire regions or countries, companies should anticipate that outside assistance will likely be much slower than during normal operations. sE

This article was prepared by Corporate Risk International’s (CRI) Worldwide Advisory Intelligence Service (WAIS). CRI is a full service security consulting group headquarterd in Reston, Va (www.corprisk.com).

create a Pandemic PreParedness Plan

The who has urged companies to prepare for possible disrup-

tions in business as the result of a human pandemic. while the

breadth and scope of a contingency plan will vary according

to the nature and size of the company, businesses can employ

some of the following recommendations:

n esTablish a crisis managemenT Team (cmT) that will

take responsibility for developing a pandemic preparedness

plan and assume responsibility for critical business decisions

if a pandemic occurs. designate a manager to take charge

and distribute emergency information

n deTermine whaT circumsTances will trigger your cor-

porate response plans.

n esTablish a budgeT to create a cmT and to prepare

for concerns during a pandemic, including a sharp drop in

income.

n review or develop employee healTh procedures

to minimize the potential for transmission of infectious dis-

ease to other workers, including washing hands and sanitiz-

ing work areas.

n review human resource policies for leave, travel,

working remotely, quarantine and insurance coverage.

n review The supply chain for your business to under-

stand where and how it might be vulnerable during a pan-

demic; keep in mind that supplies by outside companies may

be disrupted.

n idenTify whaT services can be handled remotely.

n TesT operaTional conTingency plans regularly.

consider running exercises using various outbreak scenarios

to test your plan’s effectiveness.

n regularly conTacT governmenTs, international

agencies and industry groups about the availability of guid-

ance that could benefit your company or staff.


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703-519-6200 www.asisonline.org

Your Resource for Career Connections in SecurityLooking for that perfect fit? The National Association of Security Companies introduces it’s all-new online employment service, the NASCO Contract Security Career Center - your resource for career connections in the security industry.

For Employers: This easy-to-use resource is designed to help you recruit the most qualified professionals in the industry.

For Job Seekers: Whether you’re looking for a new job, or ready to take the next step in your career, we’ll help you find the opportunity that’s right for you.

To find a job or fill a position, visit http://careercenter.nasco.org today.

Contract Security Career Centerhttp://careercenter.nasco.org

NASCO H-page ad1.indd 1 8/30/2006 5:17:13 PM


FEATURED ARTICLE : : XXXXXXFEATURED ARTICLE : : SUBCONTRACTING

A Fertile environment For SubcontrActingAs the practice takes hold of the industry,

take care to avoid insurance snafus.

By Mike Lehner

PhOTOGRAPhER: FRANz PFlUEGl | AGENCY: DREAMSTIM

E.COM

18

leGal disclaimer

A

s contract security firms continue to consolidate, forming

super-regional and national agencies, a movement of small

privately owned firms has emerged to fill in local relationships.

In order to compete with the super-regional or national security firms,

many small security operators have adopted a business practice of subcon-

tracting to other small firms throughout the country. Interestingly, super-

regionals and national firms are also sometimes required to give small busi-

nesses or minority-owned security firms a small part of a national contract.

Regardless of business size, subcontracting for any reason is a contractual

relationship that should be done with care, planning and proper risk

management.

To protect your business when subcontracting, a few simple rules may help

you avoid, reduce and deter unwanted litigation:

1 . C E R T I F I C A T E o F I n s U R A n C E M A n A G E M E n T .

Obtain a certificate of insurance from your subcontractor that names you

and your client as additional insureds on the general liability and auto li-

ability insurance plans of your subcontractor.

Defense coverage is the primary motive in your request or demand for

additional insured status under your subcontractor’s general liability or auto

liability policy. Far too often the prime contractor only gets a certificate

of insurance in favor of his company, leaving the client relationship open

to liability and exposure. Be sure to include your client when asking for a

certificate of insurance.

2 . W A I v E R s o F s U b R o G A T I o n R E q U E s T .

Request a waiver of subrogation from your subcontractor in favor of both

your company and your client. Waiver of subrogation should be requested

for both your sub’s workers’ compensation and general liability insurance

plans. An additional way to protect the interests of both you and your

client from subrogation is to include a waiver of subrogation provision in

your subcontract agreement. Just as the insurer has the legal right to pursue

subrogation, so too does a party to a commercial transaction have the right

to structure it in order to prevent a specific insurer from subrogating against

another of the parties. Some states do not allow subrogation regardless of

contract terms.

3 . C R I M E A n D F I D E L I T y R E q U E s T .

In case your subcontractor’s employee steals from your client, require a fi-

delity bond that delivers some protection to get your client repaid promptly.

The key: make sure coverage includes third-party crime and no arrest or

conviction clause applies.

4 . U M b R E L L A R E q U E s T .

If your client asks you for an excess or umbrella limit, it is critical that any

subcontractor that works for you carries equal excess limits of protection

5 . s U b C o n T R A C T I n G A G R E E M E n T .

Establish a standard subcontracting agreement for use with all subcontrac-

tors. The agreement should include an indemnity/hold harmless provision

in favor of both you and your client.

Finally, coordinate a procedure with your insurance broker to collect and

follow up on all subcontractor certificates of insurance. In most states, any

subcontractor that doesn’t provide a workers’ compensation insurance certif-

icate is a subcontractor that you are paying workers’ compensation benefits

for in the event a subcontract employee is injured. Your workers’ compensa-

tion insurance carrier will audit your uninsured subcontract expense and

charge it as payroll. sE

Mike Lehner is principal of the Large Lines Division of The Mechanic Group.

The information contained in this article is for general guidance on matters of interest only. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, and the inherent hazards of subcontracting, there may be omissions or inaccuracies in information contained herein. Accordingly, the information in this article is provided with the understanding that the authors and publishers are not herein engaged in rendering insurance, legal, accounting, tax or other professional advice and services. As such, it should not be used as a substitute for consultation with your trusted insurance advisor. Before making any decision or taking any action, you should consult with your trusted insurance advisor.

While we have made every attempt to ensure that the information contained in this article has been obtained from reliable sources, The Mechanic Group is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this article is provided “as is” with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will The Mechanic Group, its related partnerships or corporations, or the partners, agents or employees thereof be li-able to you or anyone else for any decision made or action taken in reliance on the informa-tion in this article or for any consequential, special or similar damages, even if advised of the possibility of such damages.

19


Legislative Update

�0

Provision of bill pertinent to private security services changes the Proprietary Security Services Act and the Private Security Services Act to allow a registered proprietary private security offi cer to request review by disciplinary committee and to contest an adverse action. The bill itself covers numerous other regulated entities in non-security categories.

Approved by

governor on

Sept. 29, 2006.

CA

S.B

. 18

49

SuppoRtive

Clarifi es that unlicensed security or investigative companies are subject to licensing requirements and to the penalties described in 24 Del. C. Section 1303(b). This bill enables law enforcement to enforce regulatory statutes. Further, the bill enables the board to discipline a licensee when that licensee has consumed or been impaired by alcohol or a controlled substance while on duty.

Signed by

governor on

July 6, 2006.

DE

S.B.

373

SuppoRtive

Bill authorizes appropriations for FY 2007 for military activities of the Department of Defense, pre-scribes military personnel strengths for FY 2007, with additional issues addressed. Sec. 333 of confer-ence committee’s report extends authority for contractor performance of security guard functions to Sept. 30, 2009. Ten percent cut from Oct. 1, 2006’s number of contract security guard personnel for FY 2008, and additional 10% reduction for FY 2009. Secretary of defense to report to House and Senate Armed Services Committees on contractor performance of security guard functions by Feb. 1, 2007.

Signed by president

on Oct. 17, 2006.

US

H.R

. 51

22

StronglySupports

Amends current licensing law for security regulation in Washington, D.C. Sets training requirements and calls for a security offi cer registry. Requires companies to pay fees for security offi cer applicants. Creates an advisory council with power to make recommendations to mayor. The council is com-posed of four security managers, three security offi cers, one property owner or manager, two union representatives and one college instructor expert on security issues. Effective date to be delayed for training and examination provisions. According to note added at second reading, funding for pro-posed FY 2007 budget will not be suffi cient to cover implementation costs for all program changes in bill. Fiscal note says metro police will need $591,000 to fund fi rst year.

Enacted July 25,

2006. Projected

D.C. law date is

Feb. 23, 2007.

DC

B16

-10

2

SuppoRtive

Private Security Offi cer Employment Enhancement Act of 2006 would amend “Intelligence Reform and Terrorism Prevention Act of 2004” to authorize secretary of homeland security to process criminal records checks through FBI’s database for “covered employees” of “covered employers” who provide security services or certain proprietary security employers. Request would be made through DHS, and report would be provided to employer under tight restrictions as to use and handling of information.

Referred to the House Education & Workforce Committee’s Subcommittee on Employer-Employee Relations on Sept. 28, 2006.

US

H.R

. 5

89

3

SuppoRtive

supportive of legislation to provide private security companies timely access to criminal background checks on private security offi cers.

SUM MARY AND WHAT I T MEANS TO NASCO MEMBERS NASCO’S V IEW BI L L STATUS

supportive of required training and security offi cer registry. raised concerns over several other provisions, especially employer-paid fees and advisory council composition.

Part of compromise package reached between Gov. Corzine and legislature after government shut down in early July 2006 over budget issues. Increased current sales and use tax from 6% to 7% on July 15, 2006; expanded base of sales and use tax on October 1, 2006 to include investigative and security taxes.

Approved P.L.2006,

c.44 July 8, 2006.

NJ

A.B

. 4

901

NOTSUPPORTIVE

nasco has retained nJ counsel to help in effort to repeal sales tax on security services. initial meetings with nJ’s leadership have begun. coalition against security Tax (casT) is forming now.

All information is accurate as of press time.

The Right Solution

“Providing the right people with the right skills to deliver the right service.”

Protecting the Future of America Since 1850www.securitasinc.com 1-800-232-7465

Securitas USA’s security professionals help protect our nation’s infrastructure by providing security services to the nation’s seaports, government sites, telecommunications facilities, energy plants

and petrochemical sites. In the event of a designated terrorist attack, the Department of Homeland Security has granted Securitas USA both Designation and its highest level of liability protection, Certification, under the SAFETY Act*. And this protection can extend to you, our clients, when

Securitas’ security services are deployed.

Securitas Security Services USA — transforming guarding to security solutions

*Support Anti-terrorism by Fostering Effective Technologies Act. For more information about the Department of Homeland Security and the SAFETY Act, visit www.safetyact.gov

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Security Executive - Oct/November 2006