A Gimlet Eye for Fake I.D.

Another small company with few Street followers that is bound to grab investor attention is Intelli-Check (IDN), whose patented I.D.-Check software detects fake driver's licenses, fake military papers, and the like. Intelli-Check's customers include the Pentagon and Sensormatic Electronics, the leading supplier of security systems to retailers and mass merchandisers. Bart Blout, who heads Sawtooth Capital Management, which has accumulated 335,000 shares of Intelli-Check, says that in view of the terrorist attacks, document verification will become a necessary tool in eliminating identity fraud--and will be sought out by airports, banks, and retailers. The growing menace of identity theft is costing businesses some $25 billion a year, says Blout. Intelli-Check's technology, he notes, reads and validates the information encoded on the magnetic stripes and bar codes embedded in drivers' licenses in 40 states in the U.S. Intelli-Check expects the other states to sign up, too.

John Bendall of Hermitage Capital expects Intelli-Check's software to make major inroads this year into supermarket and drugstore chains and department stores. He expects sales of $10 million and earnings of 4 cents a share this year and sales of $30 million and earnings of 45 cents a share in 2002. He expects the stock, which has more than doubled--from 3.70 a share in March to 8.60 on Sept. 10--to hit 30 this year.

By Gene G. Marcial

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