It seemed impossible, at a time when fingernail clippers were being confiscated by the hundreds at American airports, that a man could slip past a checkpoint at O'Hare International Airport in Chicago with a bag of knives, mace and other weapons.
But security experts in the aviation industry were not surprised to learn that the workers running the scanners at that United Airlines terminal last Saturday were employed by Argenbright Security, the nation's largest and most frequently criticized airport-security company. The incident in Chicago only added to the long list of security breaches involving the company.
PHOTO: REUTERS
Argenbright has come to dominate the industry in the last 20 years with 6,000 checkpoint screeners, almost all of whom make little more than minimum wage and receive no health benefits or sick days. Its lapses and high turnover have become the principal argument of those in Congress who want to federalize airport security.
The company
The company -- which has 40 percent of the nation's airport security business -- has been an aggressive competitor in the battle to get security contracts with major airlines, rising from a small polygraph operation in 1979 to a diverse corporation extending far beyond the security industry. Its security operation alone sold for US$185 million last year, and its revenues at just one airport, in Philadelphia, were US$6 million in 1998, according to legal documents.
But as the airlines sought to cut costs and award security contracts to the lowest bidder, screening companies began what many in the industry call a race to the bottom, hiring employees at the lowest possible wage and cutting corners to keep checkpoints staffed, with turnover approaching 400 percent a year in some airports.
Argenbright's rise has been accompanied by federal convictions on conspiracy to avoid performing background checks for employees in Philadelphia last year, a jail term for one company supervisor, and probation for the company in Pennsylvania and Illinois. A judge ruled the company illegally tried to dismiss employees after they went on strike to protest low wages and benefits.
Not blind
"The corporation couldn't have been blind to what was going on in places like Philadelphia," said Billie Vincent, the director of civil aviation security at the Federal Aviation Administration in the 1980s and now president of an airline consulting firm in Virginia. "The system in effect forced them into dishonest activity and made it impossible to do the job without cutting corners."
On Sept. 11, two teams of hijackers carrying boxcutters passed through Argenbright checkpoints at airports in Washington and Newark, and at two other companies' checkpoints in Boston. Repeated security violations also led to the company's departure from Detroit Metropolitan Airport.
And the federal government said a few weeks ago that even after Argenbright agreed to conduct better background checks on its workers, it continued to hire them by the hundreds without adequately examining their pasts. Attorney General John Ashcroft accused the company of committing "an astonishing pattern of crimes that could have directly jeopardized public safety" at 13 of the nation's largest airports where it screens passengers.
"Argenbright Holdings continues to violate laws that protect the safety of Americans who travel by commercial airlines," Ashcroft said. "Our investigation shows Argenbright Holdings has hired screeners who have disqualifying criminal convictions, including convictions for theft, burglary and illegal drug possession, and that Argenbright Holdings made false statements about its employees' backgrounds."
Congressional supporters of federalizing airport security regularly use Argenbright as an example of why the system must be removed from the private sector.
Bill Barbour, Argenbright's president, said in a conversation Thursday morning that he would call back to discuss his company, but he did not do so. In legal documents, however, company officials have said the Justice Department has exaggerated the extent of the background-check problem, although they recently agreed to extend the terms of their probation with the US Attorney's office in Philadelphia.
The company -- with 19,000 employees -- says it is forced to hire large numbers of low-wage screeners quickly because of the high turnover in the jobs and the cost strictures imposed upon by the airlines, which are responsible for security but hire contractors like Argenbright to do the actual work.
"ASI faced certain challenges and had certain initial missteps in the implementation of the program" to correct its problems, wrote John Dodds, a lawyer for Argenbright Security Inc, in a letter to federal authorities in August. "However, over the past several months, the company has made substantial progress, which I expect will continue going forward."
Acquisition
He said part of the reason for the company's problems was its acquisition on Dec. 28 last year by Securicor, a British security company, which Dodds said had temporarily slowed down its plans for improvement. Argenbright had been a division of AHL Services Inc, which continues as a marketing and customer-fulfillment company for other businesses. Its founder, Frank Argenbright, was appointed chief executive of Securicor's American security operations; its offices remain in Atlanta.
A review of hundreds of pages of government documents on the problems that have beset Argenbright demonstrates patterns of mismanagement that help explain why the industry has become such a target in Washington.
Philadelphia
As prosecutors revealed in last year's criminal case in Philadelphia, Argenbright for years had no internal controls or audit systems that would have detected its district manager's deliberate forging of workers' histories to hide criminal convictions and hire as many people as possible.
At the time, many of the 1,300 Argenbright workers at the Philadelphia International Airport were hired despite failing a test required by the FAA, or without taking the test at all. Dozens had criminal records, including felony convictions for forgery, aggravated robbery, narcotics possession and aggravated assault -- one had been arrested for kidnapping.
Instead of the required 40 hours of training, hundreds of workers were simply shown a 45-minute video and pronounced by Argenbright fit to begin X-raying carry-on baggage and running the metal detectors.
The Philadelphia district manager who changed the workers' histories, Steven E. Saffer, told his superiors at the company of serious problems at the airport, but they did nothing about it, prosecutors said. Saffer is now serving a 30-month federal prison sentence, and two of his colleagues at the airport received fines and probationary sentences. None of Argenbright's top officials were indicted, but the company itself pleaded guilty to two counts of making false statements to the FAA and paid fines and penalties of US$1.55 million.
John J. Pease, the assistant US attorney general who prosecuted the case, said the penalties would have been far greater had the company not agreed a year ago to begin a program to prevent such problems from recurring.
That is why both the Justice Department and the FAA were so astonished to discover that Argenbright had not taken care of the problems after last year's plea agreement.
In a series of spot checks over the last 12 months, government officials found the company continued to employ and hire departure screeners with criminal backgrounds, failed to have a program of independent verification of worker's backgrounds, and waited nine months even to have a meeting of its new compliance management committee.
The government found violations of FAA regulations by Argenbright at Dulles International Airport and Reagan National Airport in Washington, La Guardia Airport in New York, and the major airports in Los Angeles, Boston, Massachusetts, Detroit, Michigan, Phoenix, Arizona, Las Vegas, Nevada, Dallas-Fort Worth, Texas, Seattle, Washington Trenton, New Jersey, Columbus, Ohio, and Cedar Rapids, Iowa.
Pullout
Argenbright pulled out of the Philadelphia airport last month, citing economic reasons. But its successor, Aviation Safeguards of New York, has also had problems. It was sentenced to two years of probation and fined US$110,000 last year after a supervisor at Miami International Airport allowed 22 employees to work in secured areas without performing background checks and then lied about his actions to the FAA.
In June, Argenbright had to pay a US$10,000 fine to the Illinois Department of Professional Regulation, which found that the company had not filed registration forms for 97 employees, in violation of state law regulating security companies. And after Saturday's incident at O'Hare, the company fired two of its workers who were caught on videotape stealing two of the knives that had been confiscated from the man who tried to take them aboard the aircraft.
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