State Asked to Probe Private Security Firm : Commission Says Badges and ID Cards Closely Resemble LAPD’s

The Los Angeles Police Commission has asked state officials to investigate the use of badges, ID cards, concealed weapons and government license plates by a private security business operating out of the offices of Allied Artists Records, a Studio City-based company that is the subject of a fraud lawsuit by Union Bank.

Allied Artists and its parent, Consolidated Allied Companies Inc., were placed in receivership by Superior Court Judge Ricardo A. Torres last month after Union Bank said in the lawsuit that the company had obtained more than $7 million in loans on the basis of phony financial statements.

Court-appointed receiver David L. Ray told The Times on Wednesday that so far he has been unable to find any current financial records. He has, however, compiled a lengthy list of secured creditors who say they are owed a total of $27 million.

Other lenders, Ray said, include General Electric Credit Corp., First Interstate Leasing, Great Western Leasing and Textron Financial. “The list reads like a Hall of Fame of commercial finance companies,” said a lawyer for one of the lenders.

Consolidated President Kim Richards said last week that Union Bank’s contention of fraud were “incorrect,” but declined further comment on the lawsuit. Calls to Consolidated officials and the company’s attorneys were not returned Wednesday.

The security firm, Consolidated Allied Internal Security, is licensed by the state to provide bodyguard protection for company officers and recording artists as well as a 24-hour security patrol at the company’s three locations.

According to Ray, the security firm was apparently operated separately from the other Consolidated companies and is not named in the Union Bank lawsuit. But after news reports last week about the lawsuit, investigators for the Police Commission visited the Consolidated offices in Los Angeles and Orange County. They examined the security firm’s badges, ID cards and license-plate documents that were found by court officers who had been dispatched to secure the buildings in connection with the lawsuit.

The police commission--a five-member policy board for the Los Angeles Police Department--had previously investigated Richards in 1979 for operating a private security firm without a proper license. No charges were filed, officials said, after Richards agreed to quit the private security business.

The badges and ID cards found at the Consolidated offices are a facsimile of those used by the Los Angeles Police Department, according to Police Commission investigator Lt. John Ferguson.

“It’s basically our badge without city hall in the background,” Ferguson said. “The ID cards are identical except for their own wording, and on back there is a statement saying that the holder is entitled to carry a concealed firearm, which is not true, you have to have penal code authority to carry a concealed weapon.”

In addition, Ferguson said he discovered that official “E” government license plates have been issued for three of Consolidated’s private patrol cars. “It was done somehow through the Department of Motor Vehicles,” which has been asked to investigate, he said.

Unlicensed Organizations

Ferguson said the information about the badges and ID cards was forwarded to the Department of Consumer Affairs, which oversees the licensing of private security patrols.

The badges and ID cards--photocopies of which were obtained by The Times--indicate that the security officers are employed by either the Allied Artists Internal Police Department or the Allied Public Transit Police. Neither organization is licensed as a security firm in California, according to the Department of Consumer Affairs.

“We would never authorize that kind of badge--you can’t have any connotation at all that you are a police department,” said Ernest Luzania, deputy chief with the Bureau of Collections and Investigative Services of the Department of Consumer Affairs.

The ID cards are signed by Jerry S. Miller, who is identified as the “Chief of Police” of the Allied Artists Internal Police Department. Miller could not be reached for comment Wednesday.

As previously reported by The Times, Miller is a former Los Angeles police officer who was once involved with Kim Richards in the private security firm that ran afoul of the police commission in 1979. Miller and Richards currently are under indictment in Arizona for allegedly perpetrating a hoax on the Mohave County Sheriff’s Office.