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Tuesday, February 07, 2006

AccuFacts Pre-Employment Screening (APES) misc

Anthony J. Luizzo
This guy is the real driving force behind this company. His son is now the CEO and that could work out fine because the requirements for running a business are not as severe as for creating one.

Anothony offers continuing education classes at The College of Staten Island: "Security is a State of Mind: Personal Safety Awareness" (6 sessions) and "Identity Theft: Fantasy, Fiction, and Facts" (one session). Both of these seem very interesting and I might even go there for the one session class. (also listed here)

On that same site, we see that Anthony is Co-President of the New York 10-13 Association, Brooklyn and Staten Island, Inc. along with Harold Carlin (who's listed as one of the Knights of Pythias and was part of a police union action to stop the parole of a cop killer back in 2004). Also Academic Advisor.

Anthony is CEO of L.C. Consultants with services of deposition review, trial preparation site, inspections, expert testimony.
Dr. Anthony J. Luizzo, Ph.D., CFE, CST has over 38 years of law enforcement and corporate security management experience and often testifies in litigation involving premises liability and related security / safety management and deficient background screening litigation.
He's also active as a guest lecturer.

Here's an article Anthony wrote in The CPA Journal Online. This is relevant to the investing work I do! It talks about SAS 53 and the auditor's responsibility to detect and report errors and irregularities. I added it to my reading list.

Some various other links here and here and here and here and so forth.
“You should guard your social security and date of birth information with your life,” (said Anthony J. Luizzo, a retired . New York Police Department detective, who teaches security and identity theft courses at the College of Staten Island.
You can see a picture of Dr. Luizzo here on the extreme right. Like they say, a picture is worth a thousand words.

Here's a link where Anthony J. Luizzo along with Frank A. Luizzo and Philip F. Luizzo (who is now CEO) offered a security seminar for casino management back in 1996. Here's the article on Amazon.

Another Amazon article, 8 pages: Investigating in a new environment
Another Amazon article, 7 pages: Delving deeper to decypher fraud

A blog entry which links to one of the things I mentioned above.

Philip Luizzo
He wrote an article with his father, Anthony, in 1999 here which is typical for a business: write up educational articles to demonstrate credibility.

Here's a quote in Hotel Interact
ive (yeah, it's really just a glorified press release).
“In a hotel atmosphere, management is always looking for the guest to return and stay away from the competition. If a guest has a bad experience, they will tell 10 people,” said Philip Luizzo, Chairman and CEO of Accufacts. “If anything is missing from the room, even if it is $5 on the counter, that guest will leave the hotel and tell people of even the slightest misstep.”
The director of security at the Plaza Hotel has some quotes that interleave. He's apparently a customer of Accufacts.
Luizzo said that Accufacts can uncover felony, misdemeanor, and traffic offenses because of their ability to obtain records in every county (about 3,000) in the United States and as well as detecting if the applicant is really who they claim to be. Further, most reports can be turned around in 24 to 48 hours, so it doesn’t bog down the hiring process.

“Most of our clients have a 7% to 10% hit ratio on all applicants. That means when looking at an applicant pool across the board, seven to 10 out of a 100 will have problems. They could have otherwise been hired,” said Luizzo.

Lastly, Accufacts will help to design policies for corporations and has helped HR directors negotiate the legalities of this process to make sure every search that’s done is legitimate.

“We educate our clients and help them design a policy and application to ensure the necessary releases are included,” Luizzo said.
Apparently, Philip Luizzo spun off on the front stretch at the Smyna NASCAR speedway. Oops, wrong guy. :-)

John Svedese

Didn't find anything of any substance.

Richard Maglio
This is the Maglio, Inc that was merged with Accufacts, no? This site shows it has the same address as Accufacts. It might be that Maglio, Inc was re-created. That would explain the $5,313 non-competition 3-year covenant listed in the 10-K for 2004 and 10-K for 2003.

This article on Recruiter.com talks about red flags and the "Chainsaw Al" situation at Sunbeam (note, the book about Chainsaw Al is in my reading list). Al Dunlap was fired twice before joining Sunbeam. But that's really not applicable because he was a CEO star at th
at point.
Richard Maglio, the Vice-President and COO of Accufacts, a background checking service says, "To me it's beyond the liability. It's a reflection on my business as a recruiter in terms of serving and maintaining a client. I would be mortified if I provided a candidate who I had screened in the mind of my client and then have that individual turn out to have falsified information. I would assume that my client relationship would be over."
The article has not date on it.

Maglio, Inc has some IP addresses - MAGLIO INC. (NETBLK-MGCN-MAGLIO-1 )

There's also NetList, Inc. with a contact name of Rocco Maglio located in Spring Hill, Florida.

Stock Options and Warrants

Another big question is stock options outstanding. This SEC filing from 2002 shows 280K shares offered for consulting to James E. Patterson as stock options with half having strike price of 35 cents and half at 50 cents. This was covered in the 10-K for 2002.

They also registered for a stock purchase plan for 200K shares at 18 cents. This was also covered by the 10-K for 2002 above.

James Patterson (shown above) was a director of the company in 2001. He owned 2.1% of the stock via the 140K options.
Mr. Patterson has over 25 years of experience as a management consultant. He is President and CEO of Vector Gp., an international consulting firm since 1997. He has served as a Director of Applied Management Corporation and is Chairman of the Board of the Theater at Holy Cross, a non-profit New York City theater organization specializing on new artists. He holds B.S and M.S. degrees in Economics and has earned Ph.D. credits in Economics.

Auditor Check

A lot of this was covered when I looked at the 10-K.

2004: Tedder James Worder & Assoc.
2003: same
2002: same, but the text notes a change in goodwill accounting (which occured around that time)

On Dec 8, 2000, they changed auditors from Marcum & Kliegman and switched to Meeks, Dorman and Co which then merged with Cuthill & Eddy LLP. I'm sure this late filing notice had something to do with AccuFact's displeasure. It's for the period ending June 30, 2000.
Registrant was delayed in filing this report due to a delay in receiving
information from the Compan's [sic] outside accountants.
Marcum & Kliegman gave AccuFacts an unqualified audit opinion for 1999. But even that 10-K was late.
In October 1999, the Registrant acquired all of the operating assets of
Maglio, Inc., a pre-employment screening services company based in Longwood, Florida, by merging Maglio, Inc. with and into Maglio-Accufacts Pre-Employment Screening, Inc., a Delaware corporation and wholly-owned subsidiary of the Registrant. As a result of the foregoing activities, the Registrant requires additional time to provide appropriate disclosures about the transaction in the financial statements as required by Registrant S-X and generally accepted accounted principles.
On July 17, 2002, they dismissed Cuthill & Eddy and hired Tedder etc. who had given them an unqualified opinion for 2001.

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