Back in April of 2013, research firm Detwiler Fenton claimed that Z10 devices were being returned in unusually high numbers, which caused BlackBerry stock to drop nearly 8%. At the time, the claim sounded rather crazy because it essentially made it look as though returns were exceeding sales.
BlackBerry understandably took issue with the claims and stated they were absolutely false and sought a US and Canadian review of the claims through Securities and Exchange Commission and Ontario Securities Commission and now it appears as though they might be seeing some justice on the matter according to a new report from the Boston Business Journal.
A former executive at a Verizon Wireless retailer was arrested Thursday for allegedly selling confidential sales and product information to the Boston financial services firm Detwiler Fenton, including information that caused BlackBerry's stock price to plummet in April 2013.
James Dunham, the former chief operating officer of Connecticut company Wireless Zone, allegedly secretly provided the information to Detwiler for more than three years. In exchange, Detwiler paid Dunham $2,000 per month, for a total of approximately $61,000, according to a criminal complaint lodged in federal court.
According to the complaint, Dunham was the source behind a controversial research note published by Detwiler analyst Jeff Johnston in April 2013. The note said that BlackBerry's Z10 smartphone, which was new at the time, was being returned to stores by customers at an unusually high rate. BlackBerry's stock price fell more than 7 percent in one day following the publishing of the note.
As noted by the Boston Business Journal, the complaint does not identify Detwiler, BlackBerry or Wireless Zone by name but they claim to of have been able to identify the companies by comparing information in the complaint with publicly available financial records.