Travel Industry

Future of registered travelers is unclear

Want to know whether  the idea of paying to pre-clear frequent travelers’ trips through airport security is a great business idea? Launch it, file for bankruptcy, and watch the feeding frenzy for your company. Nearly four months after CLEAR, the company Americans paid as much as $200 a year to join, went belly-up, three companies are scrambling to buy its assets (read: customer database) and take its place.

According to reporters at the Orlando Sentinel, Orlando appears to be the big prize everyone is after. MCO is not only the first airport to offer the expedited security service, it has the most registered in the database Morgan Stanley is now babysitting. Clear operated in a total of 18 airports in the United States, including DC, Los Angeles, New York and Atlanta.

All places frequent fliers would prefer to go to the front of the line.

So why the four-month wait? It turns out, buying citizen’s security information that claims they’re not terrorists is a legal quagmire. For starters, the Transportation Security Administration had washed its hands on participation in 2008 — before Clear’s bankruptcy — because officials there had determined it wasn’t a terrorist-proof system, and went back to merely doing the same background checks it does for every single airborne passenger in America. Now the U.S. House of Representatives wants TSA to change its stance and get on board. The new TSA chief Erroll Southers, a former FBI agent who has also served as the LAX police department’s assistant chief, might do just that.

Second, Clear owed a lot of its partners money, and the airports are saying they want reimbursement before they’ll dive in again.

What's next?

But even without the federal background check component, plenty of flyers would pay to skip sharing security lines along with every family headed to and from Disney World, even though the special registered traveler lanes still require you to take off your shoes, pull out the laptop, and put the liquid bottles in a baggie. In fact, Henry Inc., one of the bidders for the service, claims 90 percent of Clear’s previous customers say they’ll resign, even if they aren’t reimbursed for the funds they lost when the first company collapsed.

And that’s no doubt why the companies fighting to revive this regsitered traveler idea are assuring Americans the program will be back, even if they can’t describe how.

Photography: courtesy .schill (Flickr), hyku (Flickr)

FlyClear, a New York based company which charged annual fees for clear card services to help it’s members get through TSA Airport Security checkpoints faster, ceased operations earlier this week.

Clear Card from FlyClear

Apparently, Clear’s parent company – Verified Identity Pass Inc., was “unable to negotiate an agreement with its senior creditor to continue operations.” The Clear Lanes being operated at 20 airports nationwide, and being used by the over 260,000 people who had signed on with FlyClear, suddenly closed on Monday without any prior intimation.

The service had an annual price tag of $199, and the company says it’s not in a position to offer any refund. And it looks like the company is closed for good, with no plans for any comeback. They haven’t filed for bankruptcy protection, and they’ve wiped all the data from the airport verification kiosks.

FlyClear was founded in 2003 by entrepreuner Steven Brill, and the program took off at Orlando International Airport in 2005. The Clear Lanes at Orlando alone have seen over 1 million passengers pass through. For frequent and elite travelers stressed out by the post-9/11 security measures and extra-long lines at Airport Security checkpoints, Clear provided a much-needed service – A Clear Card with a biometric chip issued after a TSA vetting which whisked you past the bottlenecked checkpoints.

Inspite of the obvious need for such a service – and this is probably one of the main reason for Clear’s demise – fact is that neither the TSA nor the airlines ever fully embraced it, and they weren’t really able to expand the service and make it a commonly available facility at all airports.

And last year in May, a laptop containing information about 33k Clear users and applicants went missing from the Clear office at San Francisco International Airport. The TSA went ballistic and revoked Clear’s Registered Traveler status. 10 days later, the laptop mysteriously turns up in the same spot where it went missing, and prettty soon, things were back to normal.

So what happens to all the data now - The fingerprints, iris images, photos, names, addresses, credit card numbers and other personal information? Clear is promising that all personal data on record will be deleted and members notified in a final email missive from the company.

But they haven’t deleted it all yet, and a statement on their website states that the information provided can only be used by companies for the TSA’s Registered Traveler program. So they could keep it on file until they’re able to ’sell’ the information in accordance with these rules.

And now, with all their assets will be up for grabs and likely to be put on sale, it only makes it harder for the company to make good on it’s promise to keep the data secure.

Either way, Clear is gone, and there’s no fast lane for a quarter of a million people who forked out $199 a year.