The FBI, the FDA and the SEC are investigating medical device maker AcuNetx (PINK:ANTX) after the company uncovered evidence of possible conspiracy, fraud and collusion between an employee, a former CEO, its distributors and a small group of shareholders.
The story begins in September 2011, when AcuNetx learned that the computer storing its financial records was stolen in March 2011, but that the theft was not reported to police until last September.
In November, an employee and the former CEO, director and consultant, Steven Butler, locked chairman Chapin Hunt out of the company’s Torrance, Calif., offices, according to a regulatory filing.
“Mr. Hunt had terminated the consulting agreement between AcuNetx and Mr. Butler on October 31, 2011. Mr. Butler refused Mr. Hunt entry to the company office and property and changed the locks on the doors,” according to an SEC filing. “Mr. Welk and Mr. Butler opened an unauthorized Wells Fargo Bank and had a distributor divert funds to this account. Mr. Welk and Mr. Butler also used a company Chase credit card and charged over $25,000. Mr Butler paid himself, his lawyers and Mr. Welk out of this unauthorized account.”
AcuNetx, which also replaced CEO Robert Corrigan in November, said it contacted the FBI after learning of the alleged conspiracy.
“A minority of shareholders have attempted to perpetrate fraud upon the board of directors in an attempt to benefit and gain at the expense of the majority of shareholders. Company employees were allegedly being paid under the table for company products and work performed by distributors and shareholders. Company property was released unauthorized and unpaid for from the AcuNetx offices,” according to one of the filings. “The board of directors continues to work with the FBI, the Office of Criminal Investigation of the FDA and the various police departments to recover property owned by AcuNetx and its affiliates.”
The stolen computer, which contained financial records for 2008-2001, and records of text messages and phone calls related to the alleged malfeasance are being forensically examined by the FBI, according to AcuNetx. The company also revealed that “an unnamed person attempted to access the rights to the 510(k), illegally and unauthorized,” according to a filing.
“The computer records were not backed up by previous management and all records were lost from the past 3 years, 2008-2011. The board of directors has hired Julia Wu, CPA and book-keeper Corina Fortes to work with the IRS and state of California to rectify AcuNetx books and financials,” according to the filing. “The FBI currently has possession of the company computer that holds the financial records and Quick Books as they are taking a forensic copy to study the company computer files and files that were deleted by its users.”
That’s not all. This week, AcuNetx reported suspected insider trading after ANTX shares spiked on Wall Street yesterday.
“It has come to the attention of management and the Board of Directors that the company stock has increased over 670% today, March 5, 2012. Unfortunately, this must be reported to the FBI and SEC as it is suspected that there is alleged insider trading,” according to the filing. “Chairman of the board Chapin Hunt has had several shareholders who are also creditors have threatened [sic] to put the company into involuntary bankruptcy. In the best interest of the shareholders, Management is taking necessary steps to avert this action.”
Hunt did not immediately respond to a request for comment.