Regulations, Vol. 33 Iss. 13 Feb 20, 2017

Titles of Regulations: 6VAC20-172. Regulations Relating to Private Security Services Businesses (amending 6VAC20-172-10, 6VAC20-172-40, 6VAC20-172-50, 6VAC20-172-80).

6VAC20-174. Regulations Relating to Private Security Services Registered Personnel (amending 6VAC20-174-10, 6VAC20-174-150).

Statutory Authority: § 9.1-141 of the Code of Virginia.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: April 21, 2017.

Agency Contact: Barbara Peterson-Wilson, Law Enforcement Program Coordinator, Department of Criminal Justice Services, 1100 Bank Street, Richmond, VA 23219, telephone (804) 225-4503, FAX (804) 786-0410, or email barbara.peterson-wilson@dcjs.virginia.gov.

Basis: Section § 9.1-102 of the Code of Virginia authorizes the Department of Criminal Justice Services (DCJS) and the Criminal Justice Services Board (CJSB) to adopt regulations for administration of Chapter 1 (§ 9.1-100 et seq.) of Title 9.1 of the Code of Virginia, and § 9.1-141 of the Code of Virginia authorizes the board to adopt regulations establishing compulsory minimum, entry-level, in-service, and advanced training standards for persons employed by private security services businesses in classifications defined in § 9.1-138 of the Code of Virginia. In addition, § 9.1-144 of the Code of Virginia requires bond or insurance for private security services, personal protection specialists, and private investigators.

Purpose: Chapter 202 of the 2015 Acts of Assembly permits a licensed private security services business to hire as an independent contractor a personal protection specialist or private investigator. The legislation requires every personal protection specialist and private investigator hired as an independent contractor by a licensed private security services business to maintain comprehensive liability insurance in an amount to be determined by DCJS.

Although 6VAC20-172 and 6VAC20-174 do not address the requirements for insurance for independent contractors, 6VAC20-172 currently requires individuals obtaining a business license to provide documentation verifying that a bond has been secured in the amount of $100,000 or a certificate of insurance for comprehensive general liability insurance with a minimum coverage of $100,000 per individual occurrence and $300,000 general aggregate. The bond and insurance amounts identified in 6VAC20-172 have not been reviewed since these regulations were first promulgated 15 years ago, and the amounts do not reflect current industry standards or needs of private security businesses and do not adequately protect the public.

Requiring personal protection specialists and private investigators serving as independent contractors to maintain comprehensive liability insurance protects the health, safety, and welfare of all parties involved. Comprehensive liability insurance protects the public against personal injury and property damage on the part of the personal protection specialist or private investigator. Additionally the insurance protects the personal protection specialist's and private investigator's personal assets up to the covered amount.

During the December 1, 2015, meeting of the Private Security Services Advisory Board (PSSAB), DCJS requested the PSSAB to recommend an amount of comprehensive liability insurance that it felt was appropriate for independent contractors and for private security businesses. The PSSAB informed DCJS staff that they did not have enough information to determine an appropriate figure. DCJS was asked to provide additional information regarding the current amount of insurance held by private security businesses and agreed to use staff from the research unit to conduct a random sample of the private security businesses.

At the March 3, 2016, meeting, the PSSAB was presented with the following results of the research:

Random sample. The DCJS Research Center selected a random sample of private security businesses from all but two of the seven private security businesses regulated by DJCS. The number of armored car and security canine handling services businesses registered with DCJS is small therefore all armored car and security canine handling services businesses were included. A total for 400 businesses made up the final sample.

• Security officer (sample size N=78)

• Private investigation (N=82)

• Armored car (N=15)

• Security canine handling (N=15)

• Personal protection (N=52)

• Electronic security (N=86)

• Locksmith (N=72)

Current requirement. Private security business insurance requirements per current regulation are (i) a surety bond in the amount of $100,000 or comprehensive general liability insurance with a minimum coverage of $100,000 per individual occurrence and (ii) $300,000 general aggregate.

Terminology:

Surety bonds are a financial guarantee of performance of a specific action. A surety bond is not liability insurance.

Commercial general liability insurance protects a business from financial loss resulting from claims of injury or damage caused to others by the business. A comprehensive policy typically covers:

• Bodily injury – physical damage to a person other than an employee of the business and injuries caused by the business at a client's home or work place.

• Personal injury – libel, slander, copyright infringement, invasion of property or privacy, wrongful eviction, false arrest, and similar acts that cause damage to a person's reputation or rights.

• Property damage – damage done to another person's property by the business in the course of conducting business.

• Advertising injury – losses caused by the business's advertising.

• Legal defense and judgments – costs to defend against real and frivolous suits and judgments up to the limit of coverage. This generally does not include punitive damages for negligence or willful misconduct.

A general aggregate insurance limit is the maximum amount of money the insurer will pay out during a policy term. Once the general aggregate limit has been exhausted, the insurer is under no obligation to cover further losses in any of the categories covered under the general liability policy.

Current general liability insurance carried by private security businesses:

• 99% (N=395) of businesses have a general liability insurance limit that exceeds the $100,000 minimum.

• One business has a $100,000 surety bond in lieu of general liability insurance.

• 93% (N=371) have a general liability limit of $1 million or more (range $1 million to $10 million).

• Average general liability insurance limit: $1,160,250.

Current general aggregate insurance carried by private security businesses:

• One business has a surety bond in lieu of aggregate liability insurance

• 97% (N=389) of businesses have a general aggregate liability limit that exceeds the $300,000 minimum.

• 93% (N=337) have an aggregate liability insurance limit of $1 million or more (range $1 million to $10 million)

• Average general aggregate liability limit: $2,344,361.

At the conclusion of the presentation on March 3, 2016, the PSSAB voted to approve the following recommendations:

1. Private security businesses shall be required to maintain comprehensive liability insurance in the amount of $1 million in general aggregate liability insurance.

2. Independent contractors working for private security businesses shall be required to maintain comprehensive liability insurance in an amount equal to the insurance requirements for private security businesses.

The PSSAB made these recommendations to the CJSB, as did DCJS. March 24, 2016, the CJSB voted to approve the recommendations of the PSSAB.

Substance: The proposed amendments allow private security services businesses licensed by DCJS to independently contract with private investigators and personal protection specialists registered with DCJS. Additionally, the language will require that every registered personal protection specialist and private investigator hired as an independent contractor maintain $1 million in general aggregate liability insurance and provide evidence of such insurance to the private security services business with which they are contracting. Private security businesses will be required to secure a surety bond in the amount of $1 million or maintain $1 million in general aggregate liability insurance.

Issues: The primary advantage to the public is ensuring an increased opportunity for civil recourse in the event that an individual is harmed as a result of interacting with private security businesses or private investigators and personal protection specialist that are independent contractors.

There are no significant advantages or disadvantages to the majority of private security businesses in Virginia. The research conducted by DCJS indicated that 93% of the private security businesses already carry general aggregate liability insurance in an amount greater than $1 million, the amount identified in the proposed regulatory action.

The primary advantage to private security businesses not currently carrying $1 million or more in general aggregate liability insurance and future private investigators and personal protection specialists who are independent contractors is increased liability protection against financial loss resulting from claims of injury or damage caused to the public. The primary disadvantage to a small percentage of private security businesses will be an increase in the cost of insurance.

The primary advantage to individuals wishing to work as independent contractors will be the ability to work in this capacity once the insurance requirements are addressed in the regulations using the standard three-stage regulatory process. The disadvantage is that completing the standard three-stage process to amend a regulation is a slow process that can take one to two years. Individuals are not able to work as independent contractors until the regulation is finalized and becomes effective.

There are no disadvantages to the general public, agency, or the Commonwealth.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Criminal Justice Services Board (Board) proposes to amend its regulations that govern private security businesses and their registered personnel to a) allow such businesses to hire registered personal protection specialists and private investigators as private contractors, b) set the amount of general liability insurance that private investigators and personal security specialists who are acting as private contractors are required to have and maintain at $1,000,000 and c) require that private security businesses maintain a minimum general liability insurance, or surety bond, limit of $1,000,000. The first two of these changes emanate from Chapter 202 of the 2015 Acts of the Assembly.¹

Result of Analysis. Benefits likely outweigh costs for one proposed change. There is insufficient information to ascertain whether benefits will outweigh costs for other proposed changes.

Estimated Economic Impact. In 2015, the General Assembly passed a bill which allows private security services firms to hire private investigators and personal protection specialists who are registered with the Department of Criminal Justice Services (DCJS) as private contractors. This legislation also stipulates that such private contractors maintain general liability insurance in an amount to be set by DCJS and that they present proof of insurance to the businesses with whom they contract. In response to this legislation, the Board now proposes to amend these regulations so to allow private security services businesses to privately contract with registered private investigators and personal security specialists so long as these individuals have at least $1,000,000 in general liability insurance and the private security businesses contracting with them document that such insurance has been obtained. Currently, registered private investigators and personal security specialists would only have insurance if they were also licensed by DCJS as private security services businesses.

The insurance limits for such businesses are currently set at $100,000 per incident and $300,000 aggregate (lifetime). Alternately, these businesses can choose to have a surety bond in the amount of $100,000. Private investigators and personal protection specialists who are currently licensed as private security services businesses and who choose to have a surety bond would not be able to increase the amount of that surety bond to $1,000,000 and use it to meet the insurance requirement to be a private contractor. As mandated by the General Assembly, they would have to instead obtain general liability insurance in the amount required by DCJS. Private investigators and personal protection specialists who are licensed as businesses with DCJS and have insurance would incur costs to raise their insurance limits to one million dollars (if they do not already have insurance that meets or exceeds that limit).

Private investigators and personal protection specialists who are not licensed as private security services businesses would newly be subject to an insurance requirement² and so would have to obtain $1,000,000 in aggregate general liability insurance. Board staff reports that the required insurance in the amount of $1,000,000 costs approximately $500 to $695 per year. Private investigators and personal protection specialist who would have to pay for this insurance would likely only choose to contract with private security services businesses if they expected the revenues from doing so to exceed their costs including insurance. Therefore, benefits will likely outweigh costs for allowing private security services businesses to hire private investigators and personal security specialists as private contractors.

As stated above, private security services businesses are currently required to have either a surety bond in the amount of $100,000 or general liability insurance with limits of $100,000 per incident and $300,000 aggregate. DCJS's research division sampled 400 of the 1,804 private security businesses they license and found that 99% of the businesses sampled had more than $100,000 worth of insurance and 93% had insurance limits at or greater than $1,000,000. The Board now proposes to increase the amount of insurance or surety bonding that licensed private security services businesses must have to at least $1,000,000. Board staff reports that this change is being proposed because most firms already have insurance in at least this amount. Board staff further reports that there have not been any incidences reported that would indicate that currently required insurance limits are inadequate.

Board staff estimates that the costs for $1,000,000 of general liability insurance would likely range between $500 and $695 per year. Assuming that DCJS's survey is representative of the entire population of private security services firms, about seven percent of firms licensed (about 126 firms) would incur additional costs for insurance equal to the cost for $1,000,000 of insurance minus their current insurance costs. One licensee who currently holds a surety bond estimates that increasing his bond from $100,000 to $1,000,000 will increase his costs for bonding from $323 per year to $1,200 per year.³ There is no information to measure the possible benefits of requiring greater insurance limits, so there is insufficient information to ascertain whether those benefits would outweigh the estimated costs.

Businesses and Entities Affected. These proposed regulatory changes will affect all private security services businesses, including private investigators and personal protection specialists who are licensed as private security services businesses. Board staff reports that there are 1,804 private security businesses licensed by the DCJS. Board staff further reports that there are currently 1,805 private investigators and 522 personal protection specialists registered with the DCJS.

Localities Particularly Affected. No localities will be particularly affected by these proposed regulatory changes.

Projected Impact on Employment. These proposed regulatory changes may lead to private investigators and personal protection specialists being hired by private security services businesses as private contractors. This may not affect total employment as private contracting will likely serve as a substitute for other types of employment in these businesses. Higher insurance costs may affect whether marginally profitable private security services businesses choose to remain licensed.

Effects on the Use and Value of Private Property. These proposed regulatory changes are unlikely to affect the use or value of private property in the Commonwealth.

Real Estate Development Costs. These proposed regulatory changes are unlikely to affect real estate development costs in the Commonwealth.

Small Businesses:

Definition. Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

Costs and Other Effects. Small business private security services firms, including private investigators and personal protection specialists, who do not already maintain liability insurance of at least $1,000,000 will incur costs for increasing their insurance limits to that level. Board staff estimates, from a sample of 400 businesses, that 93% of private security services firms already have insurance that exceeds the proposed limit. Assuming that sample is representative, seven percent of the 1,804 private security firms licensed by the DCJS (about 126 firms) will incur additional costs for insurance. The additional costs incurred will equal the cost of the new, higher, limit for insurance minus the cost of these businesses' current insurance of less than $1,000,000.

Alternative Method that Minimizes Adverse Impact. Since raising the insurance limits for private security services firms is a discretionary change based on information about what insurance these firms on average have, rather than what limits are minimally necessary to protect health and safety in the Commonwealth, the Board might further minimize additional costs by lowering the proposed insurance limits or leaving required insurance at current levels.

Adverse Impacts:

Businesses. Private security services firms, including private investigators and personal protection specialists, that do not already maintain liability insurance of at least $1,000,000 will incur costs for increasing their insurance limits to that level. Board staff estimates, from a sample of 400 businesses, that 93% of private security services firms already have insurance that exceeds the proposed limit. Assuming that sample is representative, seven percent of the 1,804 private security firms licensed by the DCJS (about 126 firms) will incur additional costs for insurance. The additional costs incurred will equal the cost of the new, higher, limit for insurance minus the cost of these businesses' current insurance of less than $1,000,000.

Localities. Localities in the Commonwealth are unlikely to see any adverse impacts on account of these proposed regulatory changes.

Other Entities. No other entities are likely to be adversely affected by these proposed changes.

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¹http://leg1.state.va.us/cgi-bin/legp504.exe?151+ful+CHAP0202

²Chapter 202 of the 2015 Acts of Assembly requires that these individuals have general liability insurance "in a reasonable amount to be fixed by the Department." The amount of insurance that is proposed by DCJS is $1,000,000.

³From Board research findings, it appears that very few licensees (likely less than five statewide) choose to carry a surety bond rather than insurance. While the cost increases for increasing surety bonds is likely much higher, it would affect far fewer businesses.

Agency's Response to Economic Impact Analysis: The Department of Criminal Justice Services respectfully disagrees with several statements and conclusions contained within the economic impact analysis (EIA) drafted by the Department of Planning and Budget (DPB).

Summary of the Proposed Amendments to Regulation.

Chapter 202 of the 2015 Acts of Assembly authorizes private investigators and personal protection specialists to work as independent contractors provided they maintain a general liability insurance policy, in an amount determined by DCJS.¹

Independent of this new statutory change, the Code of Virginia authorizes private security service businesses to be licensed provided they maintain a general liability policy or surety or cash bond, in an amount to be determined by the Board.

Result of Analysis.

The EIA concludes that allowing private security businesses to hire registered personal protection specialists and private investigators as independent contractors will likely result in benefits outweighing potential costs. DCJS agrees with this conclusion as it is reasonable to expect that parties will only engage in independent contracts when it is profitable.

The EIA also concludes that insufficient information exists to ascertain whether the benefits outweigh the costs for (i) requiring registered personal protection specialists and private investigators who want to work as independent contractors to maintain a general liability insurance policy in the amount of $1,000,000 and for (ii) requiring private security businesses to maintain a minimum general liability insurance policy or bond in the amount of $1,000,000. DCJS disagrees with these two conclusions.

The benefits of requiring $1,000,000 insurance for registered personal protection specialists and private investigators and for private security businesses: The General Assembly determined as early as 1976 that insurance is a necessary component for private security businesses. In 1998, the General Assembly enacted legislation requiring private security businesses to obtain a bond or liability insurance at the initial point of being licensed by DCJS. The General Assembly also added language specifically requiring the business to maintain the bonds or liability insurance for the duration of their licenses. By its very nature, insurance protects businesses from unforeseen events and accidents. Private security businesses that have insurance are shielded from potentially expensive claims and litigation costs. Insurance also provides the public a resource to obtain compensation for losses caused by businesses. The General Assembly also made the Criminal Justice Services Board (CJSB) responsible for determining the appropriate amount and type of insurance for private security businesses. The CJSB initially set the amount of insurance at $100,000 more than 20 years ago. This amount had not been reviewed or revised until 2015.

In addition to requiring private security businesses to have insurance or bond, the General Assembly has also determined that a benefit and need exists for certain professionals to have insurance in order to be licensed by the state. The very nature of engaging in certain professions, such as doctors, lawyers, and law enforcement, includes exposure to risk and liability. The private security industry is no exception to risk exposure; in fact, the type of work conducted by private security businesses presents increased risks for their employees who are engaged in potentially dangerous activity and situations while securing and protecting property. Many of these professionals are licensed by DCJS to carry firearms in the performance of their duties. The General Assembly relied on the same reasoning as it did for other professionals when it authorized two types of private security professionals to act as independent contractors in 2015, provided they have the appropriate insurance coverage as determined by DCJS.

Given the General Assembly's directive to determine the amount of insurance necessary for private investigators and personal protection specialists to act as independent contractors, DCJS consulted with private security and insurance professionals, engaged the Private Security Services Advisory Board, and conducted evidence based research. DCJS staff spent a significant amount of time with DPB staff explaining the process the agency used to arrive at its decision.

DCJS utilized its Research Center to arrive at an informed, educated conclusion regarding the appropriate amount of insurance necessary for independent contractors and private security businesses. The Research Center is managed by a professional with a PhD, and the data was developed and analyzed using scientifically sound methods. Furthermore, the combined years of research experience of the two staff who participated in this project is approximately 45 years.

The DCJS Research Center selected a random sample of 400 private security businesses regulated by DJCS. The sample size of 400 was determined using a standard statistical formula to generate a sample size with a 95% confidence interval. In other words, by using a sample size of 400 businesses, the sample is 95% accurate in representing the entire private security business population. This standard statistical formula is widely used in the scientific research field.

Security Officer (sample size N=78)

Private Investigation (N=82)

Armored Car (N=15)

Security Canine Handling (N=15)

Personal Protection (N=52)

Electronic Security (N=86)

Locksmith (N=72)

The statistical research demonstrates that 99% of the private security businesses licensed by DCJS already have insurance policies that exceed the current requirement of $100,000. In fact, 93% of these businesses have a general liability policy of $1,000,000 or more. The average liability amount for private security businesses is $1,160,250. This evidence suggests that the private security business industry has already determined that $100,000 is inadequate to meet their business needs and that $1,000,000 minimally meets that need. During this research process, it became clear to DCJS that a $100,000 general liability insurance policy is woefully inadequate to meet and protect the needs of private security businesses and the public at large. It is insufficient for covering bodily injury, personal injury, property damage, advertising injury, and legal defense and judgments.

After discussions with staff from DPB who suggested that DCJS determine whether any claims have been filed against private security actors or remained unpaid due to current insurance requirements, DCJS looked into the matter. DCJS is not in a position to know whether any of its licensees have been sued or whether insurance claims have been filed and paid because these businesses are not required to report this type of data to DCJS. However, DCJS is aware of a 2014 case (Pompey v. Palla) in which a jury returned an $8 million judgment against a security officer arising out of his excessive force and wrongful arrest of a citizen of the Commonwealth. This case demonstrates that lawsuits against private security actors can result in judgments exceeding $1,000,000 and that $100,000 is not sufficient insurance coverage.

DCJS strongly disagrees with the following statement in the EIA: "Board staff reports that this change is being proposed because most firms already have insurance in at least this amount." This statement does not accurately reflect the numerous and lengthy conversations that board staff had with DPB. There is a statutory requirement to determine the amount of general liability insurance for private investigators and personal protection specialists. In the process of researching this issue, DCJS determined that the original amount of insurance required for private security businesses had not been reviewed or analyzed for approximately 20 years. DCJS would have been remiss in its duties as the regulatory agency for private security businesses had it not brought this issue before the board. DCJS regulates all private security businesses and determining the insurance requirements for two specific types without comprehensively researching this issue would have been inappropriate and possibly viewed in the eyes of the law as negligent supervision of regulatory duties. It would not be appropriate to set a general amount of the liability insurance requirement for two types of professionals that grossly exceeds the private security businesses' general liability insurance requirements.

Furthermore, DCJS has determined that the cost to purchase a general liability insurance policy that satisfies the current requirements ($100,000/$300,000 aggregate) is the same as the cost to purchase $1,000,000 in coverage. DCJS's initial research indicates that it costs approximately $500 to $695 per year for $1,000,000 of general liability insurance. Based on the issuance of the amended EIA, DCJS worked with staff from the Virginia Department of Treasury to determine the cost to purchase a $100,000/$300,000 aggregate general insurance policy, which ranges from $500 a year for low-risk activity to $1,000 to $5,000 a year for higher risk activity. These estimates have also been validated by professionals serving on the Private Security Services Advisory Board who have previously communicated with the DCJS that it cost the same to purchase $100,000 of coverage as it does $1,000,000. It is important to note that the Private Security Services Advisory Board approved the $1,000,000 insurance policy requirement for both independent contractors and private security businesses. It is for these reasons that DCJS believes that this regulatory action will have little to no fiscal impact on private security businesses or individuals who want to work as independent contractors.

DPB staff suggested that DCJS provide data demonstrating the number of legal judgments against private security businesses that were not paid as a result of insufficient or no insurance. DCJS appreciates the value of such data and will explore the possibility that private security businesses should be required to report unpaid judgments to DCJS as a new regulatory requirement.

Businesses and Entities Affected.

DCJS disagrees with DPB's conclusion that "all" private security businesses are affected by the regulatory package. As explained above, the research shows that 93% of security businesses already carry $1,000,000 or more in general liability insurance. In other words, 93% of the private security businesses will not be impacted. Furthermore, the impact to the remaining businesses is minimal given the similarity in cost to purchase insurance coverage of $100,000 or $1,000,000. Not all private investigators and personal protection specialists will choose to engage in independent contracting; not all private security businesses will choose to hire independent contractors. These businesses, by virtue of their statutory definition, already employ either or both private investigators or personal protection specialists as part of their corporate structure.

Further, there is no requirement that registered personal protection specialists and private investigators must engage in independent contracting in order to find gainful employment. Acting as an independent contractor is entirely discretionary on the part of an individual licensee and not mandatory. All registered personal protection specialists and private investigators must work for a licensed private security business in order to engage in the activity providing those services. This new law will only impact those professionals who wish to operate more like freelance employees, and presumably those professionals will consider all the pros and cons, to include financial costs and tax and other legal implications (independent contractors are typically viewed as self-employed under federal tax laws; respondeat superior relationship is not necessarily established when businesses contract with independent contractors). DCJS does not know how many of the currently registered personal protection specialists and private investigators wish to engage in independent contracting, nor will it know this data once the regulations become effective as there is no reporting requirement.

Costs and Other Effects.

DCJS also disagrees with the notion described in the EIA that existing private investigators and personal protection specialists who currently have business licenses and cash or surety bonds would be prohibited from working as independent contractors unless they obtain general liability insurance. Obtaining a private security business license entitles businesses to engage in contractual agreements. In other words, private security businesses already meet the statutory requirements regarding insurance, regardless of whether they are operated by one person or 100 people, and can still conduct business without having to switch from a bond to insurance.

Chapter 202 of the 2015 Acts of Assembly allows licensed private security businesses to contract with individuals who are registered as private investigators or personal protection specialists who are not licensed as businesses. The law does not impact or prevent a private security business that has general liability insurance from contracting with another private security business that has a surety or cash bond.

DCJS staff takes issue with the figures reported by DPB staff regarding the cost to obtain a surety bond. The EIA provides figures from one licensee who currently maintains a surety bond. DPB has included this figure referenced as an estimate but provides no information regarding the basis of the estimate. The cost of a surety bond is calculated not only based on the total amount of the bond but also the risk of the particular business and the risk of the individual applicant attempting to obtain the bond. The EIA does not state if the licensee consulted anyone to obtain the estimate nor does it specify if this individual has any additional risk factors influencing the cost of the bond. Additionally, board staff is concerned that the footnote included by DPB is misleading as it references board research findings but is attached to a statement that does not identify or reflect any research conducted by the DCJS Research Center. At best, the surety cost estimate cited in the EIA is spurious.

Effects on the Use and Value of Private Property.

DCJS believes that these regulatory changes will have absolutely no impact on the use or value of private property in the Commonwealth.

Alternative Methods that Minimizes Adverse Impact.

As stated, the cost to purchase a general liability insurance policy is the same regardless of whether the policy provides $100,000 or $1,000,000 in coverage.

The research conducted by the DCJS Research Center, the information gathered by DCJS staff to compile the agency background document, and the information in this response to the EIA supports the Governor's initiative to use evidence-based decision making in determining public policy that impacts public safety and citizens of the Commonwealth.

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¹For clarification, the statutory language uses the term "independent contractor" not private contractor, which is cited in the EIA. The term independent contractor has certain legal and tax implications, to include recognition by the Internal Revenue Service as self-employed.

Summary:

The proposed amendments (i) allow private security services businesses licensed by the Department of Criminal Justice Services (DCJS) to independently contract with private investigators and personal protection specialists registered with DCJS, (ii) require that every registered personal protection specialist and private investigator hired as an independent contractor maintain $1 million in general aggregate liability insurance and provide evidence of such insurance to the private security services business with which they contract, and (iii) require that all private security businesses secure a surety bond in the amount of $1 million or maintain $1 million in general aggregate liability insurance.

Part I
Definitions

6VAC20-172-10. Definitions.

In addition to the words and terms defined in § 9.1-138 of the Code of Virginia, the following words and terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise:

"Administrative Process Act" means Chapter 40 (§ 2.2-4000 et seq.) of Title 2.2 of the Code of Virginia.

"Board" means the Criminal Justice Services Board or any successor board or agency.

"Date of hire" means the date any employee of a private security services business or training school performs services regulated or required to be regulated by the department.

"Department" or "DCJS" means the Department of Criminal Justice Services or any successor agency.

"Director" means the chief administrative officer of the department.

"Electronic images" means an acceptable method of maintaining required documentation through the scanning, storage, and maintenance of verifiable electronic copies of original documentation.

"Employee" means a natural person employed by a licensee to perform private security services that are regulated by the department.

"Firearms endorsement" means a method of regulation that identifies an individual registered as a private security registrant and has successfully completed the annual firearms training and has met the requirements as set forth in 6VAC20-174.

"Firm" means a business entity, regardless of method of organization, applying for an initial or renewal private security services business license or private security services training school certification.

"Incident" means an event that exceeds the normal extent of one's duties.

"Independent contractor" means a self-employed personal protection specialist or a private investigator who (i) maintains comprehensive liability insurance in an amount fixed by the department, (ii) has been issued a registration by the department, and (iii) enters into a contract to perform work for a private security business licensed to provide services within the Commonwealth.

"Intermediate weapon" means a tool not fundamentally designed to cause deadly force with conventional use. This would exclude all metal ammunition firearms or edged weapons. These weapons include but are not limited to baton/collapsible baton, chemical irritants, electronic restraining devices, projectiles, and other less lethal weapons as defined by the department.

"Licensed firm" means a business entity, regardless of method of organization, that holds a valid private security services business license issued by the department.

"Licensee" means a licensed private security services business.

"Official documentation" means personnel records; Certificate of Release or Discharge from Active Duty (DD214); copies of business licenses indicating ownership; law-enforcement transcripts; certificates of training completion; a signed letter provided directly by a current or previous employer detailing dates of employment and job duties; college transcripts; letters of commendation; private security services registrations, certifications or licenses from other states; and other employment, training, or experience verification documents. A resume is not considered official documentation.

"On duty" means the time during which private security services business personnel receive or are entitled to receive compensation for employment for which a registration or certification is required.

"Performance of his duties" means on duty in the context of this chapter.

"Person" means any individual, group of individuals, firm, company, corporation, partnership, business, trust, association, or other legal entity.

"Physical address" means the location of the building that houses a private security services business or training school or the location where the individual principals of a business reside. A post office box is not a physical address.

"Principal" means any sole proprietor, individual listed as an officer or director with the Virginia State Corporation Commission, board member of the association, or partner of a licensed firm or applicant for licensure.

"Private security services business personnel" means each employee of a private security services business who is employed as an unarmed security officer, armed security officer/courier, armored car personnel, security canine handler, detector canine handler, private investigator, personal protection specialist, alarm respondent, a locksmith, central station dispatcher, electronic security employee, an electronic security sales representative, electronic security technician, or electronic security technician's assistant.

"Reciprocity" means the relation existing between Virginia and any other state, commonwealth, or province as established by agreements approved by the board.

"Recognition" means the relation of accepting various application requirements between Virginia and any other state, commonwealth, or province as established by agreements approved by the board.

"Related field" means any field with training requirements, job duties, and experience similar to those of the private security services field in which the applicant wishes to be licensed, certified, or registered. This term includes law enforcement and certain categories of the military.

"This chapter" means the Regulations Relating to Private Security Services Businesses (6VAC20-172).

Part IV
Business License Application Procedures; Administrative Requirements; Standards of Conduct

6VAC20-172-40. Initial business license application.

A. Prior to the issuance of a private security services business license, the applicant shall meet or exceed the requirements of licensing and application submittal to the department as set forth in this section.

B. Each person seeking a license shall file a completed application provided by the department including:

1. For each principal and supervisor of the applying business and for each electronic security employee of an electronic security services business, his fingerprints pursuant to this chapter;

2. Documentation verifying that the applicant has secured a surety bond in the amount of ~~$100,000~~ $1 million executed by a surety company authorized to do business in Virginia, or a certificate of insurance reflecting the department as a certificate holder, and showing a policy of comprehensive general liability insurance ~~with a~~ in the minimum coverage amount of ~~$100,000 per individual occurrence and $300,000~~ $1 million of general aggregate liability insurance issued by an insurance company authorized to do business in Virginia.

a. Every personal protection specialist and private investigator who has been issued a registration by the department and is hired as an independent contractor by a licensed private security services business shall maintain comprehensive general liability insurance in the minimum coverage amount of $1 million of general aggregate liability insurance; and

b. Documentation verifying the personal protection specialist or private investigator has obtained the required insurance shall be provided to the private security services business prior to the hiring of such independent contractor;

3. For each nonresident applicant for a license, on a form provided by the department, a completed irrevocable consent for the department to serve as service agent for all actions filed in any court in this Commonwealth;

4. For each applicant for a license except sole proprietor or partnership, the identification number issued by the Virginia State Corporation Commission for verification that the entity is authorized to conduct business in the Commonwealth;

5. A physical address in Virginia where records required to be maintained by the Code of Virginia and this chapter are kept and available for inspection by the department. A post office box is not a physical address;

6. On the license application, designation of at least one individual as compliance agent who is certified or eligible for certification;

7. The applicable, nonrefundable license application fee; and

8. Designation on the license application of the type of private security business license the applicant is seeking. The initial business license fee includes one category. A separate fee will be charged for each additional category. The separate categories are identified as follows: (i) security officers/couriers (armed and unarmed), (ii) private investigators, (iii) electronic security personnel, (iv) armored car personnel, (v) personal protection specialists, (vi) locksmiths, and (vii) detector canine handlers and security canine handlers. Alarm respondents crossover into both the security officer and electronic security category; therefore, if an applicant is licensed in either of these categories, he can provide these services without an additional category fee.

C. Upon completion of the initial license application requirements, the department may issue an initial license for a period not to exceed 24 months.

D. The department may issue a letter of temporary licensure to businesses seeking licensure under § 9.1-139 of the Code of Virginia for not more than 120 days while awaiting the results of the state and national fingerprint search conducted on the principals and compliance agent of the business, provided the applicant has met the necessary conditions and requirements.

E. A new license is required whenever there is any change in the ownership or type of organization of the licensed entity that results in the creation of a new legal entity. Such changes include but are not limited to:

1. Death of a sole proprietor;

2. Death or withdrawal of a general partner in a general partnership or the managing partner in a limited partnership; and

3. Formation or dissolution of a corporation, a limited liability company, or an association or any other business entity recognized under the laws of the Commonwealth of Virginia.

F. Each license shall be issued to the legal business entity named on the application, whether it is a sole proprietorship, partnership, corporation, or other legal entity, and shall be valid only for the legal entity named on the license. No license shall be assigned or otherwise transferred to another legal entity.

G. Each licensee shall comply with all applicable administrative requirements and standards of conduct and shall not engage in any acts prohibited by applicable sections of the Code of Virginia and this chapter.

H. Each licensee shall be a United States citizen or legal resident alien of the United States.

6VAC20-172-50. Renewal business license application.

A. Applications for license renewal should be received by the department at least 30 days prior to expiration. The department will provide a renewal notification to the last known mailing address of the licensee. However, if a renewal notification is not received by the licensee, it is the responsibility of the licensee to ensure renewal requirements are filed with the department. License renewal applications must be received by the department and all license requirements must be completed prior to the expiration date or shall be subject to all applicable, nonrefundable renewal fees plus reinstatement fees. Outstanding fees or monetary penalties owed to DCJS must be paid prior to issuance of said renewal.

B. Licenses will be renewed for a period not to exceed 24 months.

C. The department may renew a license when the following are received by the department:

1. A properly completed renewal application;

2. Documentation verifying that the applicant has secured and maintained a surety bond in the amount of ~~$100,000~~ $1 million executed by a surety company authorized to do business in Virginia, or a certificate of insurance reflecting the department as a certificate holder, and showing a policy of comprehensive general liability insurance ~~with a~~ in the minimum coverage amount of ~~$100,000 per individual occurrence and $300,000~~ $1 million general aggregate issued by an insurance company authorized to do business in Virginia.

a. Every personal protection specialist and private investigator who has been issued a registration by the department and is hired as an independent contractor by a licensed private security services business shall maintain comprehensive general liability insurance in the minimum coverage amount of $1 million of general aggregate liability insurance; and

b. Documentation verifying the personal protection specialist or private investigator has obtained the required insurance shall be provided to the private security services business prior to the hiring of such independent contractor;

3. Fingerprint records for any new or additional principals submitted to the department within 30 days of their hire date provided, however, that any change in the ownership or type of organization of the licensed entity has not resulted in the creation of a new legal entity;

4. On the application, designation of at least one compliance agent who has satisfactorily completed all applicable training requirements;

5. The applicable, nonrefundable license renewal fee and applicable category of service fees; and

6. On the first day of employment, each new and additional supervisor's fingerprints submitted to the department pursuant to § 9.1-139 I of the Code of Virginia.

D. Each business applying for a license renewal shall be in good standing in every jurisdiction where licensed, registered, or certified in a private security services or related field. This subsection shall not apply to any probationary periods during which the individual is eligible to operate under the license, registration, or certification.

E. Any renewal application received after the expiration date of a license shall be subject to the requirements set forth by the reinstatement provisions of this chapter.

F. On the renewal application the licensee must designate the type of private security business license he wishes to renew. The fee will be based upon the category or categories selected on the renewal application.

6VAC20-172-80. Business standards of conduct.

A licensee shall:

1. Conform to all requirements pursuant to the Code of Virginia and this chapter.

2. Ensure that all employees regulated or required to be regulated by the board conform to all application requirements, administrative requirements, and standards of conduct pursuant to the Code of Virginia, 6VAC20-174, and this chapter.

3. Not direct any employee regulated or required to be regulated by the board to engage in any acts prohibited by the Code of Virginia, 6VAC20-174, and this chapter.

4. Employ individuals regulated or required to be regulated as follows:

a. A licensee shall employ or otherwise utilize individuals possessing a valid registration issued by the department showing the registration categories required to perform duties requiring registration pursuant to the Code of Virginia;

b. A licensee shall not allow individuals requiring registration as armored car personnel, armed security officers/couriers, armed alarm respondents with firearm endorsement, private investigators, personal protection specialists, detector canine handlers, or security canine handlers to perform private security services until such time as the individual has been issued a registration by the department;

c. A licensee may employ individuals requiring registration as an unarmed alarm respondent, a locksmith, a central station dispatcher, an electronic security sales representative, an electronic security technician, an unarmed armored car driver, an unarmed security officer, or an electronic security technician's assistant for a period not to exceed 90 consecutive days in any registered category listed in this subdivision 4 c while completing the compulsory minimum training standards as set forth in 6VAC20-174 provided:

(1) The individual's fingerprint card has been submitted;

(2) The individual is not employed in excess of 120 days without having been issued a registration from the department; and

(3) The individual did not fail to timely complete the required training with a previous employer;

d. A licensee shall not employ any individual carrying or having access to a firearm in the performance of his duties who has not obtained a valid registration and firearms endorsement from the department; and

e. A licensee shall maintain appropriate documentation to verify compliance with these requirements. A licensee shall maintain these documents after employment is terminated for a period of not less than three years.

5. Not contract or subcontract any private security services in the Commonwealth of Virginia to a person not licensed by the department. Verification of a contractor's or subcontractor's license issued by the department shall be maintained for a period of not less than three years.

6. Enter into contracts with self-employed personal protection specialists and private investigators to work as independent contractors in accordance with § 9.1-144 of the Code of Virginia and require documentation verifying the personal protection specialist or private investigator has obtained the required insurance in accordance with 6VAC20-172-40 and 6VAC20-172-50 prior to the hiring of such independent contractor.

6. 7. Ensure that the compliance agent conforms to all applicable application requirements, administrative requirements, and standards of conduct pursuant to the Code of Virginia and this chapter.

7. 8. Permit the department during regular business hours to inspect, review, or copy those documents, electronic images, business records, or training records that are required to be maintained by the Code of Virginia and this chapter.

8. 9. Not violate or aid and abet others in violating the provisions of Article 4 (§ 9.1-138 et seq.) of Chapter 1 of Title 9.1 of the Code of Virginia, 6VAC20-173, 6VAC20-174, or this chapter.

9. 10. Not commit any act or omission that results in a private security license or registration being suspended, revoked, or not renewed, or the licensee or registrant otherwise being disciplined in any jurisdiction.

~~10.~~ 11. Not have been convicted or found guilty in any jurisdiction of the United States of any felony or a misdemeanor involving moral turpitude, assault and battery, damage to real or personal property, controlled substances or imitation controlled substances as defined in Article 1 (§ 18.2-247 et seq.) of Chapter 7 of Title 18.2 of the Code of Virginia, prohibited sexual behavior as described in Article 7 (§ 18.2-61 et seq.) of Chapter 4 of Title 18.2 of the Code of Virginia, or firearms. Any plea of nolo contendere shall be considered a conviction for the purpose of this chapter. The record of conviction certified or authenticated in such form as to be admissible in evidence under the laws of the jurisdiction where convicted shall be prima facie evidence of such guilt.

~~11.~~ 12. Not obtain or aid and abet others to obtain a license, license renewal, registration, registration renewal, certification, certification renewal, or firearms endorsement through any fraud or misrepresentation.

~~12.~~ 13. Include the business license number issued by the department on all business advertising materials pursuant to the Code of Virginia. Business advertising materials containing information regarding more than one licensee must contain the business license numbers of each licensee identified.

~~13.~~ 14. Not conduct a private security services business in such a manner as to endanger the public health, safety, and welfare.

~~14.~~ 15. Not falsify or aid and abet others in falsifying training records for the purpose of obtaining a license, registration, or certification.

~~15.~~ 16. Not represent as one's own a license issued to another private security services business.

~~16.~~ 17. When providing central station monitoring services, attempt to verify the legitimacy of a burglar alarm activation by calling the site of the alarm. If unable to make contact, call one additional number provided by the alarm user who has the authority to cancel the dispatch. This shall not apply if the alarm user has provided written authorization requesting immediate or one-call dispatch to both his local police department and his dealer of record. This shall not apply to duress or hold-up alarms.

~~17.~~ 18. Not perform any unlawful or negligent act resulting in loss, injury, or death to any person.

~~18.~~ 19. Utilize vehicles for private security services using or displaying an amber flashing light only as specifically authorized by § 46.2-1025 A 9 of the Code of Virginia.

~~19.~~ 20. Not use or display the state seal of Virginia or the seal of the Department of Criminal Justice Services, or any portion thereof, or the seal of any political subdivision of the Commonwealth, or any portion thereof, as a part of any logo, stationery, letter, training document, business card, badge, patch, insignia, or other form of identification or advertisement.

~~20.~~ 21. Not provide information obtained by the firm or its employees to any person other than the client who secured the services of the licensee without the client's prior written consent. Provision of information in response to official requests from law-enforcement agencies, the courts, or the department shall not constitute a violation of this chapter. Provision of information to law-enforcement agencies pertinent to criminal activity or to planned criminal activity shall not constitute a violation of this chapter.

~~21.~~ 22. Not engage in acts of unprofessional conduct in the practice of private security services.

~~22.~~ 23. Not engage in acts of negligent or incompetent private security services.

~~23.~~ 24. Not make any misrepresentation or false promise to a private security services business client or potential private security services business client.

~~24.~~ 25. Not violate any state or local ordinance.

~~25.~~ 26. Satisfy all judgments to include binding arbitrations related to private security services not provided.

~~26.~~ 27. Not publish or cause to be published any material relating to private security services that contains an assertion, representation, or statement of fact that is false, deceptive, or misleading.

~~27.~~ 28. Not conduct private security business under a fictitious or assumed name unless the name is on file with the Department of Criminal Justice Services. This does not apply to a private investigator conducting a "pretext," provided that the private investigator does not state that he is representing a private security business that does not exist or otherwise prohibited under federal law.

~~28.~~ 29. Not act as or be an ostensible licensee for undisclosed persons who do or will control directly or indirectly the operations of the licensee's business.

~~29.~~ 30. Not provide false or misleading information to representatives of the department.

~~30.~~ 31. Not provide materially incorrect, misleading, incomplete, or untrue information on any email, application, or other document filed with the department.

Part I
Definitions

6VAC20-174-10. Definitions.

In addition to the words and terms defined in § 9.1-138 of the Code of Virginia, the following words and terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise:

"Administrative Process Act" means Chapter 40 (§ 2.2-4000 et seq.) of Title 2.2 of the Code of Virginia.

"Board" means the Criminal Justice Services Board or any successor board or agency.

"Business advertising material" means display advertisements in telephone directories, on letterhead, on business cards, in local newspaper advertising, and in contracts.

"Certified training school" means a training school that is certified by the department for the specific purpose of training private security services business personnel in at least one category of the compulsory minimum training standards as set forth by the board.

"Class" means a block of instruction no less than 50 minutes in length on a particular subject.

"Classroom training" means instruction conducted in person by an instructor to students in an organized manner utilizing a lesson plan.

"Date of hire" means the date any employee of a private security services business or training school performs services regulated or required to be regulated by the department.

"Department" or "DCJS" means the Department of Criminal Justice Services or any successor agency.

"Director" means the chief administrative officer of the department.

"Electronic images" means an acceptable method of maintaining required documentation through the scanning, storage, and maintenance of verifiable electronic copies of original documentation.

"Employee" means a natural person employed by a licensee to perform private security services that are regulated by the department.

"End user" means any person who purchases or leases electronic security equipment for use in that person's home or business.

"Entry-level training" means the compulsory initial training for regulated categories and basic or intermediate firearms training standards adopted by the board for private security services business personnel who are either new registrants or failed to timely complete in-service training or firearms retraining within the prescribed time period.

"Firearms endorsement" means a method of regulation that identifies an individual registered as a private security registrant and has successfully completed the annual firearms training and has met the requirements as set forth in this chapter.

"Independent contractor" means a self-employed personal protection specialist or a private investigator who (i) maintains comprehensive liability insurance in an amount fixed by the department, (ii) has been issued a registration by the department, and (iii) enters into a contract to perform work for a private security business licensed to provide services within the Commonwealth.

"In-service training requirement" means the compulsory in-service training standards adopted by the Criminal Justice Services Board for private security services business personnel.

"Intermediate weapon" means a tool not fundamentally designed to cause deadly force with conventional use. This would exclude all metal ammunition firearms or edged weapons. These weapons include but are not limited to baton/collapsible baton, chemical irritants, electronic restraining devices, projectiles, and other less lethal weapons as defined by the department.

"Job-related training" means training specifically related to the daily job functions of a given category of registration or certification as defined in this chapter.

"Official documentation" means personnel records; Certificate of Release or Discharge from Active Duty (DD214); copies of business licenses indicating ownership; law-enforcement transcripts; certificates of training completion; a signed letter provided directly by a current or previous employer detailing dates of employment and job duties; college transcripts; letters of commendation; private security services registrations, certifications, or licenses from other states; and other employment, training, or experience verification documents. A resume is not considered official documentation.

"On duty" means the time during which private security services business personnel receive or are entitled to receive compensation for employment for which a registration or certification is required.

"Online training" means training approved by the department and offered via the Internet or an Intranet for the purpose of remote access on-demand or distance training that meets all requirements for compulsory minimum training standards.

"Performance of his duties" means on duty in the context of this chapter.

"Person" means any individual, group of individuals, firm, company, corporation, partnership, business, trust, association, or other legal entity.

"Private security services business personnel" means each employee of a private security services business who is employed as an unarmed security officer, armed security officer/courier, armored car personnel, security canine handler, detector canine handler, private investigator, personal protection specialist, alarm respondent, locksmith, central station dispatcher, electronic security employee, electronic security sales representative, electronic security technician, or electronic security technician's assistant.

"Reciprocity" means the relation existing between Virginia and any other state, commonwealth, or province as established by agreements approved by the board.

"Recognition" means the relation of accepting various application requirements between Virginia and any other state, commonwealth, or province as established by agreements approved by the board.

"Related field" means any field with training requirements, job duties, and experience similar to those of the private security services field in which the applicant wishes to be licensed, certified, or registered. This term includes law enforcement and certain categories of the military.

"Session" means a group of classes comprising the total hours of mandated compulsory minimum training standards in any of the categories of licensure, registration, or certification in accordance with this part and in accordance with §§ 9.1-150.2, 9.1-185.2 and 9.1-186.2 of the Code of Virginia.

"This chapter" means the Regulations Relating to Private Security Services Registered Personnel (6VAC20-174).

"Training certification" means verification of the successful completion of any training requirement established in this chapter.

"Training requirement" means any entry-level, in-service, or firearms training or retraining standard established in this chapter.

"Training school director" means a natural person designated by a principal of a certified private security services training school to assure the compliance of the private security services training school with all applicable requirements as provided in the Code of Virginia and this chapter.

"Uniform" means any clothing with a badge, patch, or lettering that clearly identifies persons to any observer as private security services business personnel, not law-enforcement officers.

6VAC20-174-150. Standards of conduct.

A registrant shall:

1. Conform to all requirements pursuant to the Code of Virginia and this chapter.

2. Not violate or aid and abet others in violating the provisions of Article 4 (§ 9.1-138 et seq.) of Chapter 1 of Title 9.1 of the Code of Virginia or this chapter.

3. Not commit any act or omission that results in a private security license, registration, or certification being suspended, revoked, or not renewed or the licensee, registrant, or certificate holder otherwise being disciplined in any jurisdiction.

4. Not have been convicted or found guilty in any jurisdiction of the United States of any felony or a misdemeanor involving moral turpitude, assault and battery, damage to real or personal property, controlled substances or imitation controlled substances as defined in Article 1 (§ 18.2-247 et seq.) of Chapter 7 of Title 18.2 of the Code of Virginia, prohibited sexual behavior as described in Article 7 (§ 18.2-61 et seq.) of Chapter 4 of Title 18.2 of the Code of Virginia, or firearms. Any plea of nolo contendere shall be considered a conviction for the purpose of this chapter. The record of conviction certified or authenticated in such form as to be admissible in evidence under the laws of the jurisdiction where convicted shall be prima facie evidence of such guilt.

5. Not obtain a license, license renewal, registration, registration renewal, certification, or certification renewal through any fraud or misrepresentation.

6. Not solicit or contract to provide any private security services without first having obtained a private security services business license with the department.

7. Maintain comprehensive general liability insurance in the minimum amount of $1 million in general aggregate liability insurance when the registrant:

a. Is self employed;

b. Is a personal protection specialist or private investigator; and

c. Has entered into a contract with a licensed private security business to work as an independent contractor.

7. 8. Carry a valid registration card or valid temporary registration letter at all times while on duty. Individuals requiring registration as an unarmed security officer, an alarm respondent, a locksmith, a central station dispatcher, an electronic security sales representative, or an electronic security technician may be employed for not more than 90 consecutive days in any category listed in this subdivision while completing the compulsory minimum training standards and may not be employed in excess of 120 days without having been issued a registration or an exception from the department and must carry a photo identification and authorization from their employer on a form provided by the department at all times while on duty.

8. 9. Carry the private security state-issued registration card at all times while on duty once the authorization has been approved from the department, except those individuals operating outside the Commonwealth of Virginia who shall obtain the state-issued registration card prior to providing services when physically located in the Commonwealth.

9. 10. Perform those duties authorized by his registration only while employed by a licensed private security services business and only for the clients of the licensee. This shall not be construed to prohibit an individual who is registered as an armed security officer from being employed by a nonlicensee as provided for in § 9.1-140 of the Code of Virginia.

~~10.~~ 11. Possess a valid firearms training endorsement if he carries or has access to firearms while on duty and then only those firearms by type of action and caliber to which he has been trained on and is qualified to carry. Carry or have access to a patrol rifle while on duty only with the expressed written authorization of the licensed private security services business employing the registrant.

~~11.~~ 12. Carry a firearm concealed while on duty only with the expressed written authorization of the licensed private security services business employing the registrant and only in compliance with Article 6.1 (§ 18.2-307.1 et seq.) of Chapter 7 of Title 18.2 of the Code of Virginia.

~~12.~~ 13. Transport, carry, and utilize firearms while on duty only in a manner that does not endanger the public health, safety, and welfare.

~~13.~~ 14. If authorized to make arrests, make arrests in full compliance with the law and using only the minimum force necessary to effect an arrest.

~~14.~~ 15. Engage in no conduct that shall mislead or misrepresent through word, deed, or appearance that a registrant is a law-enforcement officer or other government official.

~~15.~~ 16. Display one's registration or temporary registration along with a photo identification while on duty in response to the request of a law-enforcement officer, department personnel, or client. Individuals providing private security services as authorized pursuant to subdivision 7 8 of this section who have not received their registration must display a state-issued photo identification and authorization while on duty in response to the request of a law-enforcement officer, department personnel, or a client.

~~16.~~ 17. Not perform any unlawful or negligent act resulting in a loss, injury, or death to any person.

~~17.~~ 18. If a uniform is required, wear the uniform required by his employer. If wearing a uniform while employed as an armed security officer, unarmed security officer, alarm respondent, or armored car personnel, that uniform must:

a. Include at least one insignia clearly identifying the name of the licensed firm employing the individual and, except armored car personnel, a nameplate or tape bearing, at a minimum, the individual's last name attached on the outermost garment, except rainwear worn only to protect from inclement weather; and

b. Include no patch or other writing (i) containing the word "police" or any other word suggesting a law-enforcement officer; (ii) containing the word "officer" unless used in conjunction with the word "security"; or (iii) resembling any uniform patch or insignia of any duly constituted law-enforcement agency of this Commonwealth, its political subdivisions, or the federal government.

~~18.~~ 19. When providing central station monitoring services, attempt to verify the legitimacy of a burglar alarm activation by calling the site of the alarm. If unable to make contact, call one additional number provided by the alarm user who has the authority to cancel the dispatch. This shall not apply if the alarm user has provided written authorization requesting immediate dispatch or one-call dispatch to both his local police department and his dealer of record. This shall not apply to duress or hold-up alarms.

~~19.~~ 20. Act only in such a manner that does not endanger the public health, safety, and welfare.

~~20.~~ 21. Not represent as one's own a registration issued to another individual.

~~21.~~ 22. Not falsify, or aid and abet others in falsifying, training records for the purpose of obtaining a license, registration, certification, or certification as a compliance agent, training school, school director, or instructor.

~~22.~~ 23. Not provide information obtained by the registrant or his employing firm to any person other than the client who secured the services of the licensee without the client's prior written consent. Provision of information in response to official requests from law-enforcement agencies, the courts, or the department shall not constitute a violation of this chapter. Provision of information to law-enforcement agencies pertinent to criminal activity or to planned criminal activity shall not constitute a violation of this chapter.

~~23.~~ 24. Not engage in acts of unprofessional conduct in the practice of private security services.

~~24.~~ 25. Not engage in acts of negligent or incompetent private security services.

~~25.~~ 26. Not make any misrepresentation or make a false promise to a private security services business client or potential private security services business client.

~~26.~~ 27. Satisfy all judgments to include binding arbitrations related to private security services not provided.

~~27.~~ 28. Not provide false or misleading information to representatives of the department.

~~28.~~ 29. Not provide materially incorrect, misleading, incomplete, or untrue information on a registration application, renewal application, or any other document filed with the department.