[Evan Thomas]

I'm not remotely an expert in this sort of thing, but a few thoughts occur to me. First, your friend needs to consult a lawyer who's knowledgeable about this area. He probably has a lawyer who helped him set up the business, who can refer him to someone qualified to give advice about liability and licensing concerns. Second, as to whom to hire, a retired police officer would be ideal.

I also wonder whether your friend has adequately researched the costs of hiring someone "in-house" as opposed to contracting with a security firm. More and more companies are turning to outside contractors these days to fill all sorts of positions, mainly because it's cheaper than paying all the associated costs of having actual employees.