SEC investigates trades in Intellicheck Mobilisa stock
Port Townsend tech company whose stock fell sharply last month says regulators are looking into trading of its shares.
Seattle Times business reporter
Federal securities regulators are investigating trading in shares of Intellicheck Mobilisa, a small wireless-security company based in Port Townsend.
In a brief statement, the company said Tuesday it had alerted the Securities and Exchange Commission (SEC) to unspecified suspicious activity in its stock.
“The company takes all securities laws and SEC regulations very seriously and is cooperating with the SEC’s inquiry,” it said.
Nelson Ludlow, the company’s chief executive, declined to add specifics beyond the statement.
Intellicheck Mobilisa’s main business is making access-control identification cards and card readers; it also makes buoys that can remotely scan incoming container ships and transmit data to security officials onshore.
The company has struggled this year. Revenue for the first nine months was down 14 percent compared with the same period in 2011; it lost $381,296 in the quarter ended Sept. 30, versus a $305,965 profit in the same quarter last year.
On Nov. 13, less than a week after reporting those disappointing results, Intellicheck Mobilisa fired chief executive Steve Williams.
Ludlow, who founded one of Intellicheck Mobilisa’s predecessor companies and had been CEO until March 2011, took Williams’ place.
In a Nov. 30 letter to shareholders, Ludlow said he was especially worried that new bookings were down 78 percent in the third quarter and 50 percent in the first nine months of the year. “I do not anticipate a strong ending for 2012,” he added.
Short interest in the company rose sharply in the weeks leading up to the third-quarter earnings report, indicating that traders were betting the share price would fall, according to research by The Seattle Times.
The short interest ratio, which compares the number of shares sold short to the average daily trading volume, peaked at 33.23 on Oct. 31.
Intellicheck Mobilisa’s shares, which hit a 52-week high of $1.99 on Sept. 21, plummeted following the earnings report. They closed Tuesday at 62 cents, down a penny on the day.
Drew DeSilver: 206-464-3145 or firstname.lastname@example.org