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    I am a locksmith that works on vehicles, residential and commercial locks and on electronic security systems.  I am a certified burglar alarm installer as well.  I have active accounts and am seeking more of course.  I worked for approximately 10 years as an alarm installer for some of the big companies and now own my own modest security business.  Here is my take on Alarm Lock out codes:
    On the locksmith side of things the automotive manufacturers lock the buyer out of their cars 100% of the time when they have their car keys stolen, lost or misplaced.  Does the manufacturer give them the programming codes bypass to have a new key made?  
    The buyer has to either call a locksmith to "recover" the key bitting, access the computer through $10,000+ diagnostic equipment, purchase a pin and sometimes the key code, purchase tokens to use diagnostic equipment PER USE, use their OTHER $10,000+ key cutting equipment, then finally make a working key for the customer that sometimes costs $1200 for ONE replacement key.  (Alternatively, they can tow their car to the dealer for the same thing)  Additionally sometimes we have to dig out the computer, take it apart, de-solder memory, hook tiny leads to it, "flash" it, the reverse the process including re-soldering tiny legs to the board etc.
    It seems to me that this is fine.  It is called security.
    If alarm lock-out codes were free and easy wouldn't there be an unprecedented crime frenzy?  
    So what if we as installers/owners have to sometimes buy a replacement board, or use equipment to recover the lockout code.  The whole point is to keep our clients system as secure as possible.  It is actually a good thing that I can't waltz in to any home and take-over the panel.  If I could do it effortlessly then so could any criminal.
If an installer has taken precautions to protect their investment to me that is intelligent and logical.  The only people complaining are the folks that show up later to take it over.  Our ability to do these things also gives us job security.  If I can easily get a bypass code then so could any halfway competent computer savvy customer and program his own alarm and monitor it themselves (which I know is happening to a degree anyway...)  DIY monitoring aside, most customers that want an expensive alarm system and who are willing to pay a monthly fee EXPECT a certain level of professional security features.  Many times I explain that the board cannot be taken over, it is locked out, this protects the owner, and that I need to replace it.  Giving the client a new board, programmed the way I like it prevents hassles for us both.
    Sometimes we forget that we are in the Security Industry and that we are here to assist our clients with that very thing.  We are trying to show a profit but our real job is installing security equipment.  I think whining about how things SHOULD BE is simply that: whining.  
    BTW, think alarms are challenging?  Look into the Locksmith industry and see how expensive it is to do what some would say is easy!  If you are complaining about taking over a panel try opening a high end safe!  Customer lost his combo, now what? Also, the customer wants it opened and in perfect re-usable condition since it cost $10,000. Yes I do that all the time.  Is it easy: no, but I can charge what I want because it isn't easy.
Please make me, 
To All,
    Any alarm system put into a new construction home should be left with the factory codes (programming and user) intact. The installing company should put their “request to be  contacted” sticker on the outside of the panel and/or should have the builder give the new owner contact information for the installing alarm company thereby giving the installing company the first opportunity to get the monitoring business. However, it should be up to the new owner to decide who they use to monitor and maintain the alarm system and they should have access to the system through the factory default codes. Having said all that, most of the alarm companies in my area know each other’s lock out codes and even if they do not, most systems can be defaulted. 
    When I do run into a situation where I do not know the lock out code AND the installing company will not give it to me AND I cannot factory default the panel I simply change the board and, if necessary, the panel lock AND I do not charge the customer to do so. Then I usually drop the board off at the builder’s office with my business card and the reason for leaving the circuit board.  It usually pays off in future business.      
Michael J. Moliere
MJM Private Security Services
Impact Security Training Center
Houston, TX
    This has been going on for at least two decades here in our market.  I know this because ex installers that have left the company have told us and other dealers about this company.  They have a lock on a lot of builders. The main point that I have been told is that there is a cash payment from the dealer to the builder.  Several years ago I approached one of the builders and they said ; "you can't beat the deal I have now ".  . I replied that I could just give me a chance. End of conversation.This has been going on for very long time. I decided not to try to play that game for obvious legal, ethical reasons and other dealers agree with me.
    It sure seems (to me) that these two gentleman have the scenarios correct and have given valid and salient points to this issue.  While l'm sure there may be a time when you pay your money and not get a feature, it should be written so the end user doesn't sign away something unknowingly.  Trust is a fleeting thing.  Once the consumer finds one item, how many others would they be looking for. 
Marty  Winger
    The problem with lock out codes is that they exist.
    When I was in my own business doing builder installations we never locked out a panel that we installed for the builder.  Most often the jobs were installed at or below cost.  Hardly ever making any type of profit.  That was a business decision and risk in order to secure the monitoring, upgrades, and service when a homeowner moved in.
    The other problem is that we're making too much of it as an industry.  I'm certain you would benefit from the antagonism and angst that these lock out codes create, filing lawsuits on behalf of who knows who.  It's simply easier to swap out a control panel for the $30-$80 they cost, probably clean up wiring from the prior company installation, and convince the new homeowner to engage in aded upgraded security products.  
    But another thing comes to mind from a legal standpoint.  When I buy a new home, I buy that home free and clear of all encumbrances, liens, title issues, etc.   I'm wondering if I moved into a home that I couldn't use the alarm system if I would have recourse against the builder, the alarm company, and even the title company who issued the title policy.  Be interesting to have a case set as a precedent.
Roy Pollack, CPP SET
Director of Licensing & Training Compliance
Comcast / Xfinity Home
    I can assure you that you don't have a claim against the Title Company.  The alarm contract is not an encumbrance or cloud on title.  It's also unlikely you have a claim against the Alarm Company because you were never its customer.  You might have a claim against the builder, but that may depend on your contract with the builder.  The builder may have provided that you're getting a local system, that you're not getting codes, and that you're obliged to use his alarm company to monitor.  Point is, this is a matter of agreement, not so much ethics and morals.
    The car manufacturer analogies are funny, I suppose some don't realize that some car manufacturers actually do lock out anyone but the dealer.  
Gary Abel
    My two cents for the pile.
    If a contractor asks me to install and alarm on a home under construction as a SPEC house I know I am taking a chance on NOT getting the RMR account.  My charge to the builder includes the RMR lost if I do not get the monitoring agreement.  I do not pre wire homes for no charge and I do not give a free alarm system.
    Sale of monitoring is the obligation of the installing company. If I cannot convince the homeowner to go with me for monitoring so be it.
    The last thing you want to do is anger a new homeowner with an issue that they feel blindsided with.  By walking away like a gentleman you WILL BE DOING THE RIGHT THING.  You may not get the sale, but you can sleep better. (And you will always be  'on deck' if the company of choice fails......
    Just a knee jerk on a Monday..
    You brought up an interesting situation…  I have only a small stable of monitored accounts.  Less than 75. 
    I eliminated the use of a written long term contract.  I have only a 30 day notice required.  My feelings on contracts is that if I am not good enough to earn your business every day…..I don’t deserve to hold the customer hostage for 3 years.  I hate cell company contracts for that very reason.  If I use an equity firm to finance the system, then they ARE under a 3 or 4 year standard alarm company contract.
    However on the issue of installer or master codes.  I have the same code I use in almost all my systems.  If a customer walks on me, am I obligated to give them or the new company the code or should I force them to completely default the panel and start from scratch?
Thanks for your time in advance,
    The Standard Form Agreements require you to provide the code or default the panel, but only if the subscriber has completed the contract.  Keep in mind that the residential agreement is 5 years and the commercial agreements are for 10 years.  If the subscriber pays for monitoring or service for that period then give them the codes.  That doesn't mean the programming data, just the codes. 
    But you have more problems then codes.  Looks like you're not using a contract.  You don't believe in them.  Guess you're not too concerned with getting sued for a loss that you shouldn't be responsible for or building equity in your alarm business.  Maybe after all the time you've been in business you should have more than 75 accounts being monitored.  Think that's because you let them leave on 30 days notice?  
    Cancellation on 30 day notice is, in my view, an acceptable model when you're operating a nationwide program, especially the DIY systems.  This applies to DIY security, PERS and home automation and integration.  Your investment was minimal for an account, and you probably charged for the equipment and shipment, so you're even.  If they terminate monitoring some of these systems are useless; they can't be monitored elsewhere, at least not without a programming expense that may cost more than new DIY equipment.  
    But on a more local and personal model 30 day cancellation makes no sense.  You're not charging enough to make a decent profit; not on security or PERS.  You may be getting big bucks for the home automation and integration, so the RMR is less important.  High end home entertainment systems often run more money than fire alarms in large commercial buildings.
    I think your focus needs to be on RMR growth and retention.  You do that with contracts with long terms.  Get your contracts at www.alarmcontracts.com.  For a valuation of your company visit our Alarm Company Valuation Page.

                                           PERS: SERIES of 4 WEBINARS 
                              WEBINARS - ALL 4 WEBINARS ARE FREE 

WEBINARS:  PERS:  Personal Emergency Response Service  / Medical Alert:   how and why you need to consider getting into that business  Everything you need to know and do to get started with PERS or grow your PERS business to a nationwide operation.  Presented by a leading PERS manufacturer, a central station specializing in PERS monitoring, atttoneys who will address licensing and contract issues and telemarketing issues.  Sign up for each webinar separately.  These webinars are FREE.  You need to register in advance to reserve your spot [attendance is limited] and sign in a few minutes before each presentation.
Title:  PERS equipment and systems by Essence-USA, a leading manufacturer of PERS equipment
Date and time:  July  6, 2016  12 noon to 1 PM
Place:  your computer
Register here:  https://attendee.gotowebinar.com/register/8091795726955290115
Presented by:  Ritch Haselden, Vice President of Essence-USA.  www.essence-usa.com
Topic:  latest technology in PERS equipment.  Essence, a leading provider of IoT, cloud-based connected living solutions and PERS solutions provides theCare@Home™ Enhanced Telecare Services Platform.  The Care@Home product is An Aging-in-Place product suite that offers a seamless health monitoring experience allowing independence for seniors and peace of mind to their loved ones.
Q&A:  Send your questions in advance to ritchha@essence-usa.com
Title:  How to Select a PERS Monitoring Center
Date and time:  July  20, 2016  12 noon to 1 PM
Place:  your computer
Register here:  https://attendee.gotowebinar.com/register/5252919376200633603
Presented by:  Mike Zydor, Managing Director of Affiliated Monitoring www.affiliated.com
Topic:  Selecting the right monitoring center for your PERS business is a key to growth
Q&A:  Send your questions in advance to Mike Zydor at sales@affiliated.com
Title:  Licensing and Contracting for your nationwide PERS operation
Date and time:  July  27, 2016  12 noon to 1 PM
Place:  your computer
Register here:  https://attendee.gotowebinar.com/register/5380922320883276803
Presented by:  Licensing by Nicoletta Lakatos, Esq., licensing counsel at Kirschenbaum & Kirschenbaum; Nationwide PERS Agreement by Jesse Kirschenbaum, Esq., contract counsel at Kirschenbaum & Kirschenbaum.  Moderator: Ken Kirschenbaum, Esq.
Topic:  Licensing for nationwide PERS.  Contracting for your nationwide PERS operation.
Q&A:  Send your questions in advance.  Licensing send to Nicoletta Lakatos, Esq. at NLakatos@KirschenbaumEsq.com and any contract questions to Jesse Kirschenbaum, Esq. at Jesse@Kirschenbaumesq.com.
Title:  Telemarketing nationwide 
Date and time:  August 3, 2016  12 noon to 1 PM
Place:  your computer
Register here:  https://attendee.gotowebinar.com/register/3591740925073303811
Presented by:  Matthew Pitts, Director of Legal Compliance, Alliance Security, Rhode Island.
Topic:  state telemarketing licensing; Federal and State Do-Not-Call compliance and call scrubbing; current legislation including the Telephone Consumer Protection Act (TCPA) and the Telephone Sales Rule (TSR); vicarious liability and the use of sales affiliates; recent litigation trends. 
Q&A:  Send your questions in advance to mpitts@alliancesecurity.com