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A Euro Scanners Debacle (part 2) – European Commission ♥ OSI Systems

May 9, 2012

The European Commission has finally released its long overdue report on the health risks of using body scanners at airports. They did so in typical fashion late last Friday so to avoid any debate in the press. As expected, the report concluded that there was no threat to health. ‘Expected’ because the Commission’s science committee (SCENIHR) recently admitted to Scrap the Scanners that they had never actually run any physical tests. Their studies were purely theoretical and based on existing information regarding xrays, even though their mandate is to find ‘new and emerging health risks’.

The report was a stitch-up from the outset. The Commission has been seeking to legislate scanner use for 4 years and all their efforts to date have been, at best, underhanded and clumsy.

But what will this mean for the travelling public? Let’s take a look at the current trends and try to read between some of those lines.


The dubious success of OSI Systems

Nicely dressed (left to right) Deepak Chopra, Chairman, OSI Group, L. Satyanarayana, Vice-Chairman and Managing Director, ECIL Rapiscan, and G.P. Srivastava, Chairman and Managing Director, Electronics Corporation of India Ltd (ECIL)

Following buying the patent for the Secure 1000 backscatter (xray) body scanner from its inventor, Steven Smith, the California-based OSI Systems formed its security branch Rapiscan Systems and used the name to market the first full-body scanner which would eventually become its best-selling product. Sales were slow at first as the military and prison services (original target market) showed little interest. So, with the help of the Chertoff group headed by the then US Secretary of State for Homeland Security Michael Chertoff, they began marketing their product as an airport screening method.

Airports and governments alike were apprehensive of the scanner at first, not least because it emitted ionising radiation which is known to cause cancer. The European Commission, however, was all for the idea of scanners and sung their praises in their 2008 report on airport passenger screening. They attempted to push through a new bill on scanner use, but MEPs hated the idea and rejected it. As a direct result, OSI System’s share value plummetted to its lowest value since the creation Rapiscan (see red X) – practically zero! OSI/Rapiscan needed a miracle.

After the conveniently-timed underwear bomber incident at the end of 2009, sales began picking up as the UK and US pledged to buy the Secure 1000 , egged on by Chertoff.

Euro Commissioner Siim Kallas has a plan to scan

However, the Commission bided its time and sneakily presented its second scanners bill in 2011 by way of the Comitology process. The Comitology process has been frequently accused of being undemocratic and technocratic in that it can be used to introduce new legislation simply by it not being voted down by Parliament. The EC presented the bill and gave MEPs the possibility to reject the proposals at the beginning of the summer when most were already leaving for their holidays.

Nonetheless, OSI System’s investors showed uneasiness at the possibility of the body scanner being rejected by Parliament again and the share price took another hammering (purple X). OSI and their investors knew only too well that Europe was always key to the future of scanners in that if the European Union embraced them, then so would the rest of the world.

Only after the bill got through did the ever inept Transport Commissioner Siim Kallas call on SCENIHR (Scientific Committee on Emerging and Newly Identified Health Risks) to evaluate the health risks. At this point, you would think that the markets would have trembled at the thought of the science committee’s findings … but no. In fact since the study was commissioned, OSI’s share value has doubled! (green X) So, what were the investors privy to that we were not? It makes no sense, especially when you consider the recent rumours that the Transport Security Administration had been on the verge of abandoning the Rapiscan Secure 1000 due to health fears. Investors in OSI have shown particular confidence in the future of the scanner manufacturer in spite of the odds.

So, OSI/Rapiscan are celebrating the fact that their machine has been called “safe” by what they call “another independent study”, conveniently ignoring the fact that at least three other independent studies have concluded that it is not. One such report even claimed that 100 people per year in the US were likely to suffer cancer as a direct result of passing through a backscatter scanner, and that was not counting those who have to work alongside the machines on a daily basis.

What now?
The UK halted its plan to extend the scanners programme to all UK airports in 2010 and last year UK Secretary of Transport, Justine Greening, stated that she was waiting to see the SCENIHR report before taking any further decisions on backscatter scanners. Now the science committee has claimed that the scanners are safe, everyone seems convinced that the UK will continue to oblige airports to install scanners, in spite of the fact that most airport operators seem against the idea.

And then there are what look to be the worst Olympic games ever, with all attention being drawn away from the games and onto the ludicrous ‘security measures’ being put in place. London 2012 currently resembles a war zone more than what it should be – the greatest show on Earth. The UK government has already laid plans to install surface-to-air missiles on the roof of one residential block near the Olympic stadium, even though no one really knows what they will be targetting. We already know that there will be body scans for workers and artists at the events and we also know that Rapiscan has been awarded the contract to be the supplier of security technology. I’m betting on there being scans for visitors as well.

The rest of Europe will likely follow suit and accept the radiation scanners too. In spite of French laws that rule that ionising radiation can only be used in medicine, even the government there has been considering trials with backscatter scanners.

While the threat of transnational terrorist attacks remains ‘hardly existential‘, the scanners are still considered by legislators to be a balanced response. The question still remains after the SCENIHR report to how existential the real risk to public health is. Personally, I believe the real risk to air travel this year to be a tragic accident involving land-to-air missiles and the already overcrowded airspace over London – far greater a risk than any would be underwear bomber, especially when we consider that the latest underwear bomb plot was found to be a CIA hoax.

Duff technology? Who cares?
A recent report out of the US has highlighted the serious failings of the technology and its detection capabilities. This was demonstrated by blogger Johnathan Corbett when he recently managed to pass freely through two types of scanner with a simple metal box in his pocket – something the scanners should have detected with ease.

The report highlighted 8 areas for improvement of the system. However, these recommendations remain ‘classified’. But I do not want to be too negative about this and so I would like to offer the Department of Homeland Security my own 8 reommendations to improve airport security. Let me know what you think Ms. Napolitano:
1) Switch the scanners off and send them to be scrapped.
2) Hire professionals to run airport security instead of offering the job to absolutely anyone via pizza box ads.
3) Sack the current head of the CIA and get someone capable of the job.
4) Investigate previous security failings before taking kneejerk decisions on what should be done.
5) Leave airport security decisions to the experts rather than uninformed politicians.
6) Investigate scanner manufacturers and their lobbyists.
7) Make security inclusive of the public rather than the exclusive to Homeland Security
8) Never buy untested and unproven technology to do the job of professionals.


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