This week’s edition of Barron’s includes an article by William Alpert that outlines numerous examples of ParkerVision’s (“PRKR”) misconduct over the years. Alpert’s piece provides a comment from a short-seller investigating PRKR. Mike Farmwald is a Stanford scientist who has done extensive research on PRKR and believes the company is totally bogus. According to Farmwald, PRKR founder Jeff Parker is “in many ways the perfect con man.” As head of a company that has lost over $170 million in 17 years, Parker is adept at feigning technical language to impress investors. Yet a trained scientist can easily see through Parker’s baseless claims.
Alpert carefully raises questions surrounding PRKR’s financing. As Asensio & Company, Inc. (“Asensio”) reported several years ago, PRKR granted 305,000 warrants to Neuberger Berman, Inc.’s (NYSE: NEU) Jack M. Ferraro as compensation for the Gottardo placements. In return, Mr. Ferraro promoted PRKR during conference calls and in the media. Whale Securities Co., L. P.’s (“Whale”) brokers regularly referred to Mr. Ferraro’s position in its PRKR sales pitches.
PRKR is a stock promotion based on false product claims. Asensio’s deep research revealed Mr. Ferraro’s inappropriate relationship with PRKR. Asensio’s reports led to Neuberger Berman’s suspension of Mr. Ferraro. The firm also initiated an investigation to look for possible improprieties.
The central issue in the PRKR fiasco is that investors continued to buy shares because they believe the company’s exaggerated claims. These claims include the invention of a unique direct conversion radio frequency (“RF”) integrated circuit (“IC”), and new and universal “standard” for the front-end of transceivers called Direct2Data (“D2D”).
Alpert’s article includes the research of short-sellers to show that these claims are completely false. Several years before Alpert, Asensio came to the same conclusion. Direct conversion is not new or unique. Moreover, it does not serve a standard suitable for all applications. In contradiction to the company’s claims, direct conversion has been commonly used in consumer microelectronics since the early 1980s and is constantly being upgraded by its many existing suppliers.
PRKR’s “pump and dump” stock operation has used a combination of false product claims, private offshore stock sales, and the granting of options at no cost to permit the sale of over 3.4 million shares of its grossly overvalued stock to the public. PRKR first sold all of these shares to insiders. These insiders were then able to “dump” their shares on the public. The insider sales occurred without any public knowledge and individual investors had no way to know they were purchasing “dumped” stock.
Asensio’a PRKR reports can be viewed by clicking here.