A rapid check service making a come-back
Verified Identity Pass (V.I.P.) had 160,000 subscribers to its service, which offered travelers a quicker passage through airport security checks if they had pre-registered with the company, giving it their biometric information and agreeing to a background check; a year ago it went out of business after a row with its creditors; the rapid check service, with the backing of new investors, is making a come-back
The idea of a monthly subscription service that allows people to jump to the head of airport security lines by submitting to a fingerprint or iris scan appeared to have fallen out of favor, but now may be getting another chance. The assets of Verified Identity Pass (V.I.P.), the start-up that ran the Clear service in eighteen airports in the United States and shut down about a year ago in a dispute with creditors (“Registered Traveler program, RIP,” 27 June 2009 HSNW), were acquired for $6 million in a federal bankruptcy proceeding on 16 April.
The New York Times’s Brad Stone writes that the winning bidder, AlClear, is led by two former investment managers and backed in part by Robert V. LaPenta, chief executive of L-1 Identity Solutions, a biometrics company based in Stamford, Connecticut, which supplied kiosks and other technology to the original Verified Identity Pass.
The new company, to be renamed Clear, will be based in New York. LaPenta and Michael Chertoff, a former secretary of DHS, will sit on its board.
Stone notes that AlClear acquired the customer database, the brand, and the airport kiosks of the old V.I.P., which had more than 160,000 subscribers when it went out of business. AlClear, though, did not acquire what was perhaps the older company’s most important asset: its relationship with airports. Those contracts were voided in bankruptcy court.
The company said it was in advanced discussions with several airports and hoped to open its fast-lane security service this fall. In the next few weeks, it will begin contacting former subscribers and offering them the opportunity to reactivate their memberships.
“We know customers were left holding the bag,” said Caryn Seidman-Becker, a co-founder of the new Clear along with Kenneth L. Cornick, a former colleague in Arience Capital Management, a defunct hedge fund. “We have to rebuild relationships with airports, Washington and with our customers, and make sure we are building long-term partnerships. We want to bring back the service in the highest integrity way.”
Seidman-Becker to say that the fee for the new service would be $179 a year, down from $200, and that subscribers could buy a family plan for an additional $50. A company spokesman said that Clear would purge the personal data — including fingerprint and iris patterns — of customers who chose not to reactivate their accounts.
Stone notes that the new Clear may have additional competition. It prevailed in a lengthy bankruptcy proceeding over another group, Henry Inc., run by a San Francisco Bay Area investment banker, Kurtis Fechtmeyer. Fechtmeyer said his firm planned to move ahead anyway with developing its own airport fast-lane service.
Cogent Systems, a competitor to L-1 Identity Solutions in the market for biometric systems, also has plans to introduce a national verified-traveler program.
The companies are hopeful that they can make the concept work by reducing costs.
The vision for Clear was laid out soon after the 9/11 attacks by the entrepreneur Steven Brill, the founder of Court TV. Brill wrote that a private company could solve the problems of long security lines in airports with a smart identification card, backed by biometric tests, that would allow members to pass through special lines at airports.
The company he created, Verified Identity Pass, was the most well-known of several registered-traveler programs. It required people to go through a lengthy enrollment process, give up their personal information, and record an iris scan and fingerprints. In return, they were able to bypass security lines, accompanied by Clear “concierges” who were stationed at airports like Kennedy International.
Stone writes that V.I.P. became just as well-known for a string of miscues. In 2008 a company laptop containing the personal information of some 33,000 customers was lost for a week at San Francisco International Airport. After V.I.P. ceased operations last year, some members filed a class-action lawsuit, accusing the company of fraud and of breaching its contracts by not refunding money to subscribers. Those lawsuits were set aside during the bankruptcy process.
