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The Kiplinger Washington Editors
July 2, 2009
 

Overhauling
Financial Regs

By year-end or so, Congress will give the nod to a major rewriting of the nation's financial regulatory system. This week’s Kiplinger Letter explores whether the package will do more harm than good and what lawmakers are likely to include.
 
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I just attended a franchise seminar. The speaker represents a few hundred franchises that (he says) are hand picked. He has the prospect (aka victim?) answer some questions about themselves then he makes recomendations - based on your personality, capital situation, etc.. If you pick a franchise, then he does some due dilligence for you. If you both decide it's a good idea, he helps you get started. He says he offers this service free of charge, which means he gets a commission if he's able to sell you a franchise. Has anyone done this? Successfully? Unsuccessfully?
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Traveler ID Card Gaining Momentum

Business fliers willing to trade privacy for a speedy trip through airport security will get their chance.
 
 

The federal government is slowly warming to the idea of a national identity card for airline passengers, and pilot projects testing such a system are likely to be set up within a year.

The goal is to more quickly move frequent fliers, many of whom are traveling on business, through today's lengthy airport security checks. Under the so-called trusted traveler system, a passenger would give the government and/or airlines personal information about where he or she lives and works, his or her travel history and other data and would agree to undergo a background check that would likely include a search of records at the FBI, the CIA, the Immigration and Naturalization Service, local law enforcement agencies and credit bureaus.

Once the traveler was checked out and cleared, he or she would be issued a plastic card embedded with personal data, including digital records of fingerprints, palm prints, the face or eyes. The card would be encrypted to guard against counterfeiting and theft. A machine would verify the passenger's identity and allow him or her to speed through an airport security checkpoint reserved for fliers with the cards.

A trusted traveler system could shave an hour or more off the time it takes to pass through security, says David Stempler, president of the Air Travelers Association, which, along with the National Business Travel Association, has been advocating such a system. Minimizing airport delays is crucial to luring more business travelers back to the skies and to helping the airlines recover financially. Business travel, which generates 70% of airline profits, has been very slow to come back after the dramatic drop last fall.

"Speed is the reason people fly, but if the time advantage gets smaller and smaller due to hassles at the airports, people will say it's not worth it and will drive or take the train instead," says Stempler.

Advocates of the ID card also contend that it will allow airport security personnel to focus their attention on less-frequent, higher-risk travelers.

The trusted traveler concept is popular with the airlines, the traveling public and members of Congress, who are frequent fliers themselves. And last fall's aviation security law contained a provision authorizing, but not requiring, establishment of a trusted traveler system in the United States. A similar system, developed by EDS of Plano, Texas, has been in use at Israel's Ben Gurion Airport since 1998.

Transportation security czar John Magaw has been cool to the idea, warning that it would do nothing to detect a "sleeper" terrorist—someone who has lived and traveled in the U.S. for years, who has no criminal record and gives authorities no reason for suspicion. But Magaw's boss, Secretary of Transportation Norman Mineta, recently gave advocates some hope, saying the Bush administration is "open to some type of trusted traveler ID system."

The growing enthusiasm for a traveler ID paves the way for several pilot programs at U.S. airports, says Bret Kidd, vice president of the Global Transportation Industry Group at EDS, which is developing a prototype card. The Known Traveler card will use fingerprint biometric technology and perhaps other biometrics, too, such as a hologram of the traveler's face. Another company, Maximus, Inc., of Reston, Va., is also developing a prototype. Its FlySecure card will use fingerprints and may incorporate iris scanning and face recognition technology.

Several airports have been identified by the Department of Transportation as sites for testing new security technologies. They include Baltimore-Washington International, John F. Kennedy International in New York, O'Hare International in Chicago, Dallas/Fort Worth International and San Francisco International. But it's much too early to tell where the trusted traveler programs will be located.

Odds are that the experiments will be sponsored by the federal government and implemented by the airlines according to government specifications. Travelers will likely pay a small fee—$20 or $25—to participate in the pilot program.

Although the pilot projects can get up and running relatively quickly, several big issues will keep a nationwide system from being implemented for quite some time. Among the questions planners need to tackle: Who will issue the card, the government or the airlines? Who will manufacture it? Will the technology be standardized? Will the card be free or will there be a fee?

"Technology is not the hardest part," says Rachel Rowland, a spokeswoman for Maximus. "It's resolving these thornier issues that will take the longest time."

Researcher-Reporter: Gerry Moore

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