SEC Moves to Formal Investigation of Taser

September 27, 2005
By Alan Fein
Axcess News

Scottsdale AZ - The Securities and Exchange Commission has notified Taser International (Nasdaq: TASR), makers of stun-guns, that it was formally investigating the company's safety claims and sales. Taser announced the investigation Tuesday morning, which stunned investors who've tore out of the stock all day.

Shares of Taser closed at $6.36, down 95 cents, or 13%, on very heavy volume. The formal investigation gives the SEC subpoena power to obtain documents and testimony from all relevant parties, the company said.

Rick Smith, Chief Executive Officer of Taser said, "We continue to make all efforts to assist the SEC in completing their investigation as expeditiously as possible. We are hopeful that the expanded SEC investigation will address all pertinent issues."

The SEC is investigating impropriarities in the trading of Taser's stock. Smith said, "Recent data from ADP indicates there may be a large improper, naked short position in TASER International stock."

According to the Associated Press, 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.