Shares for gun manufacturer Smith & Wesson have fallen off dramatically after it was announced that federal regulators will conduct an investigation into the financial disclosures of the company. Shares for Smith & Wesson had been at an all-time high following the aftermath of the recent mass shooting in San Bernardino, CA, as Americans raced to the stores to purchase firearms.
The investigation into Smith & Wesson comes amid somewhat questionable allegations that the firearms company did not report adequate disclosures in its financial statements. While it is believed that Smith & Wesson was compliant with all existing SEC regulatory requirements, the SEC is reportedly looking into whether or not the company left out key information regarding how often its products are involved in crimes. It is also suspected that the gun maker stated nothing about what it has done to keep their firearms out of the hands of criminals.
Some people believe that President Obama told the SEC to put in such requirements at the last minute in an effort to trip up Smith & Wesson. SEC officials have stated that shareholders of the company would want to know whether or not the gun manufacturer has worked to prevent future instances of violence from occurring.
New York City Public Advocate Letitia James has put more pressure on firearm manufacturers. Earlier this month, James asked major lender TD bank to stop financing Smith & Wesson. She also convinced the largest pension fund in New York City, the NYC Employee Retirement System, to explore options of divesting itself from retailers of sport guns like Walmart and Dick’s Sporting Goods.
Smith & Wesson makes more than half of all revolvers owned in the United States. The company has not commented on the situation. It remains to be seen whether or not the questionable allegations against Smith & Wesson will hold up in the investigation.