10/23/2013Al Gore Accidentally Sends Investors To Speed Camera Company
Investors pour cash into failed speed camera company on the advice of former vice president Al Gore.
When Al Gore talks, people listen. On Friday, it took an off-hand reference by the former vice president to his investment in "Nest" to send the stock for the failed red light camera and speed camera firm Nestor soaring 14,900 percent.
"There are a lot of great companies out there, and our general counsel's always cautioning my partners and me not to be caught giving portfolio advice," Gore said on Yahoo Finance's Daily Ticker show. "But I'll pick one out of the blue, a product that you wouldn't think of as a great opportunity, and that's a thermostat, NEST, is a terrific company."
On Thursday, Nestor's stock, which has the ticker symbol NEST on the over-the-counter market, closed at a value of $0.001. At its peak Friday, the stock reached $0.15. By Tuesday, the stock dropped to $0.03 as investors realized Gore was promoting a thermostat company, not a speed camera company. Nestor's stock is still up 2900 percent from last week.
This is the most action Nestor has seen since the firm went bankrupt in 2009 and its automated enforcement assets were bought by American Traffic Solutions (ATS). Nestor Traffic Systems has not been the darling of market analysts since 2005, when the company was successful enough to secure a listing on the Nasdaq national market.
It did not take long for the red light camera company's fortunes to fade. Cities began dropping the use of red light cameras after Nestor's promise to bring them easy profit failed to materialize. Nestor's losses mounted, and an internal battle for control of the company ended with its founder, William Danzell, ousted as CEO. From a high of $48 a share, mismanagement sent the stock price down to a low of 13 cents, forcing Nasdaq officials to delist the firm. As the company went under, executives paid themselves handsomely while stiffing contractors who performed work for the firm. Even Danzell had to file a federal lawsuit to get the money he said Nestor owed him in back salary. The US District Court in Rhode Island entered a default judgment granting Danzell $663,218 in 2011.