SEC Probing Taser Stun Gun Safety Claims
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U.S. securities regulators are probing Taser International Inc.'s (TASR) claims about the safety of its stun guns and a recent order from a distributor, the company said.
Taser shares, among the market's hottest stocks during the past two years, fell as much as 23 percent following the news, which Taser released in a statement shortly before midnight on Thursday.
The Scottsdale, Ariz., company said it was compiling information after receiving the informal inquiry letter from the Securities and Exchange Commission (search).
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According to Taser, regulators are focused on its statements about the safety of its stun guns (search). The electric-shock devices recently were the target of a critical report by Amnesty International (search), which alleged that more than 70 people had died in the United States and Canada over the past four years in Taser-related incidents.
"We are confident our statements are supported by the safety studies of our products," Rick Smith, Taser chief executive officer, said in a statement. "We are in the process of compiling the information requested by the SEC."
The SEC is also inquiring about a recent order received by Taser from Davidson's Inc (search) , which distributes its products.
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In December, Taser said it had agreed to a deal for Davidson's to market and distribute its Taser X26C Citizen Defense (search) stun gun to firearms dealers.
Taser said the SEC letter states: "This inquiry is non-public and should not be construed as an indication by the commission or its staff that any violation of law has occurred, nor should it be considered a reflection upon any person, entity or security."
Since the beginning of 2003, Taser shares have risen more than 8,000 percent.