Vancouver promoter in U.S. row Howe Street's Donald Hutton now ANT chairman
Wednesday, January 05, 2000
Vancouver promoter in U.S. row
Howe Street's Donald Hutton now ANT chairman
Drew Hasselback
Financial Post
VANCOUVER - Donald R. Hutton, a veteran Howe Street stock promoter who today is chairman of controversial ANTs Software.com Inc., yesterday said the company made a mistake when it identified him as a certified public accountant in a filing to U.S. securities regulators.
Mr. Hutton, a disaccredited chartered accountant who helped orchestrate the notorious CHoPP Computer Corp. promotion on the Vancouver Stock Exchange in the mid-1980s, denied the filing error was deliberate deception. "This would be insanely stupid," he said in a news release.
ANTs shares plummeted yesterday on news the company's outside auditor, Jaak Olesk, resigned after learning ANTs had filed incorrect information to the United States Securities and Exchange Commission.
ANTs closed yesterday at $19 7/8 on the Over-the-Counter bulletin board, down $9 3/8. ANTs saw its share price shoot from less than $1 (US) last August to as high as $55 5/8 (US) on Dec. 23. At its peak, ANTs had a market cap of more than $640-million (US). At yesterday's close, the company was worth a total of $231.7-million (US).
In an interview with Bloomberg News last week, Mr. Hutton said he couldn't explain the company's wild stock swings. "It's a casino. It has nothing to do with value. It's the damnedest thing I've ever seen."
Yet Mr. Hutton's history with CHoPP computer, one of the largest stock flameouts in the history of the Vancouver Stock Exchange, suggests he is no stranger to sudden changes of fortune.
In the mid-1980s, CHoPP Computer shot from a mere 17¢ to the equivalent of $125 a share on news the firm would develop a supercomputer.
"There was no reason for the stock to be trading so high. The company had no assets, only promises," wrote Diane Francis in Contrepreneurs, her 1988 book about stock market scams. The supercomputer never materialized, and the stock tumbled to penny status. CHoPP voluntarily delisted itself from the VSE and migrated to the U.S. bulletin board, where it today trades under the ticker ANTS.
It appears Mr. Hutton has had problems with the accounting profession in British Columbia as well.
According to records from the Institute of Chartered Accountants of British Columbia, a Donald R. Hutton was expelled from the profession in 1968 because he "unlawfully touched and converted" money belonging to a client. He applied for readmission to the profession in 1973 but was denied.
California state officials said earlier this week that Mr. Hutton is not licensed as a CPA in California. It remains unclear whether he is entitled to practise accountancy in any other U.S. state.
Yesterday he hung up the phone when asked if he was the same Donald R. Hutton disciplined in 1968.
Apart from a personal bankruptcy in 1973, Mr. Hutton appeared to have quite a successful run as a stock promoter.
CHoPP Computer was born in 1985. Mr. Hutton and his wife Josephine touted a technology called "Columbia Homogeneous Parallel Processors," which was supposed to result in one of the world's fastest supercomputers. The stock was the first VSE listing to break the $100 barrier on news of a merger with a U.S. computer firm.
The stock went even higher when it was announced that Randy Jackson, brother of singer Michael Jackson, was interested in investing $2-million in the company. The Jackson deal was called off a few weeks later without explanation.
The supercomputer was never built, investors lost millions, but Mr. Hutton never gave up trying.
Mr. Hutton continues to operate the company from his home in Santa Barbara. The company says it is now developing software, not hardware, that will speed up computer performance. ANTs stands for "Asynchronous Non-pre-emptive Tasks."
The British Columbia Securities Commission slapped a cease trade order on CHoPP Computer on May 14, 1987, after the company stopped filing financial records to the provincial regulator.
Yet in 1998, the commission had to send out a notice reiterating its order after learning that some B.C. brokers had traded CHoPP shares, because they were unaware of the 11-year-old cease-trade order.
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