Comparator Systems Corp. is trying to make a comeback.
The troubled Irvine fingerprint technology firm, whose stock debacle gripped Wall Street, said Monday that it signed a joint venture agreement to build portable security devices with another Orange County company.
Tracker Technologies Inc., also based in Irvine, hopes to use Comparator's fingerprint identification technology as a core element of a new line of high-tech identification products, said George W. McPhee, vice president of marketing and distribution for Tracker.
Financial details of the deal were not disclosed Monday.
"Obviously, we know about [Comparator's] history. But we've focused just on their technology," McPhee said. "If we can take the technology and build a product around it, great. If that brings their company a new credibility, even better."
Comparator, which has relocated to Irvine from its former offices in Newport Beach, has been talking to Tracker Technologies about this deal for about eight months, officials said.
Founded in 1989, Tracker specializes in building hand-held devices that are used within the industrial field to monitor chemical emissions, among other things. The privately held company, with 23 employees, had revenue of about $5 million last year, McPhee said.
Tracker will pay for and control all the product development of the portable security devices, which officials describe as "fingerprint identification units" that could be used by the banking and international business community. The company is not investing in Comparator, McPhee said.
Comparator was the target of a Securities and Exchange Commission investigation after its stock zoomed from pennies a share to $1.87 in three record days of Nasdaq trading in May 1996. The stock price tumbled as abruptly, leaving investors with $2.9 million in losses.
The SEC later barred Comparator's former chief executive, Robert Reed Rogers, and its former vice president, Gregory Armijo, from ever serving as officers or directors of a public company. Neither man admitted any wrongdoing, and neither could be reached for comment Monday.
Comparator had been dormant for months, with no paid employees or products, according to its most recent filing with the SEC. Its main asset apparently is fingerprint technology that could be licensed to other companies.
La Jolla Capital Corp., the San Diego brokerage that was involved in the surge and crash, was ordered permanently barred from the "penny stock" business and fined $1 million by a disciplinary panel of the National Assn. of Securities Dealers. The ban and fine have been suspended, pending the outcome of an appeal by La Jolla Capital.
In March, the FBI and the U.S. attorney's office in Los Angeles interviewed at least one former employee and are looking into possible allegations of wire and mail fraud, according to the employee and federal sources. Sources say the inquiry is continuing.
The fiasco never should have happened, according to a report released last spring by the General Accounting Office, the investigative arm of Congress. The GAO criticized federal regulators for being lax in their reviewing procedures and for failing to investigate the firm's assets thoroughly.
Comparator now trades informally in over-the-counter transactions among broker-dealers. The company's stock rose 0.5 cent a share Monday, closing at 1.5 cents.
"As a company, we're trying to crawl, then walk, then run," Comparator Executive Vice President John D. Hinterleitner said. "We still have a long way to go."