SEC goes after Taser. TWOG, Mancini, Needham, next?
Taser Says SEC Launches Formal Probe
Tuesday September 27, 12:49 pm ET
Taser Says SEC Launches Formal Probe, Expands Investigation for Stock-Trading Activity; Stock Slips
SCOTTSDALE, Ariz. (AP) -- The Securities and Exchange Commission's inquiry into stun-gun maker Taser International Inc. is now a formal investigation with an expanded scope, the company said Tuesday. Its shares tumbled more than 9 percent.
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The SEC has been looking into claims Taser has made about safety studies for its stun guns and has also been looking into a $1.5 million, end-of-year sale of stun guns to a firearms distributor in Prescott. Some stock analysts have questioned the deal because it appeared to inflate sales to meet annual projections.
The formal probe is now also examining the possibility that outsiders acquired internal company information to manipulate the stock price, Taser said in a news release.
A formal investigation gives the SEC subpoena power to obtain documents and testimony.
Taser said it is cooperating with the investigation.
"We recognize that this has been a difficult process for our employees and shareholders," Taser's chief executive, Rick Smith, said in the release. "We continue to make all efforts to assist the SEC in completing their investigation as expeditiously as possible."
Taser began marketing police stun guns in 1998 as a way to subdue combative people in high-risk situations. Now, more than 7,300 law enforcement agencies and military installations use them worldwide.
But critics say the stun guns have been used too liberally by police and have contributed to scores of deaths. Amnesty International has compiled a list of more than 100 people the group says have died after being shocked in scuffles with lawmen.
Shares of Taser sank 68 cents, or 9.3 percent, to $6.63 in morning trading on the Nasdaq Stock Market, slipping below its 52-week range of $7.11 to $33.45.
Taser: taser.com
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