PHOENIX — The Securities and Exchange Commission has closed its investigation and recommended no enforcement action be taken on safety claims stun-gun maker Taser International Inc. made about its weapons and on an accounting issue, company officials said Tuesday.
Investors welcomed the news, boosting the company's shares by 15 percent.
The SEC first launched an inquiry in January into claims Scottsdale-based Taser made about safety studies and into a $1.5 million, end-of-year sale of stun guns to a firearms distributor in Prescott. Some stock analysts questioned the deal because it appeared to inflate sales to meet annual projections.
In September, the SEC announced it was formally investigating the company on those issues and had expanded the scope of the investigation to examine whether outsiders had acquired internal company information to manipulate stock price.
People are also reading…
Taser said the SEC is continuing to investigate the issues relating to trading in the company's stock.
"We have continuously stated that we stand behind our accounting and our statements on medical safety," said Taser President Tom Smith, adding that the company will "continue to fully cooperate with the remaining item" under investigation.
Analyst Joe Blankenship of Source Capital Group in Scottsdale said the SEC's decision removes some of the safety concerns about Taser's stun guns.
But the company probably needs to seek more acceptance from people over the chances that ancillary injuries could result from using the weapons, Blankenship said.
"The company still has to rebuild their acceptability in the market," Blankenship said.
Taser has plenty of cash on hand and faces no financial threats in the near future, Blankenship said.
SEC spokesman John Nester declined to comment on the investigation.
A Taser shoots two barbed darts attached to wires that deliver 50,000-volts for several seconds. The electrical current overwhelms the nervous system, temporarily immobilizing a person.
Taser began marketing stun guns to police in 1998 as a way to subdue combative people in high-risk situations. Now, more than 8,000 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 by law officers.