RenovaCare (RCAR) has received the designation reserved for the worst of the worst stocks, the OTC Markets’ skull-and-crossbones symbol:
RenovaCare trades on the Over-The-Counter exchange, reserved for stocks that lack the right stuff to trade on the Nasdaq or New York Stock Exchange.
Now, the OTC has slapped RenovaCare with the caveat emptor warning.
(Source: OTC Markets, TheStreetSweeper)
OTC applies the skull-and-crossbones symbol when it becomes aware of:
* Investigation of Fraud or Other Criminal Activities — There is an investigation or other indication of fraudulent or other criminal activity involving the company, its securities or insiders.
Other issues that may have entered into OTC’s decision to place RenovaCare in the bad category include:
*Stock promotions with inadequate information for the public –
This may include “spam email, unsolicited … news releases, whether published by the company or a third party.”
*Other public interest concerns –
Concerns “may include but are not limited to promotion, spam or disruptive corporate actions.”
(See OTC’s caveat emptor policy overview here)
The company has not responded to our numerous emailed and phoned requests for comment, including several new requests.
Meanwhile, there is yet another cause for concern about the experimental spray-on skin company, RenovaCare…
*Technology Inventor Is Registered To Sell Stock
The technology developer, Jorg Gerlach, can now SELL EVERY SINGLE SHARE of his RenovaCare stock.
That’s right.
RenovaCare, which paid just $400,000 for the technology, recently disclosed that Dr. Gerlach is now free to sell everything …
“The Company has determined that all shares required to be registered on behalf of Jörg Gerlach, MD PhD. may now be sold without restriction under Rule 144…”
(Source: Company SEC filing)
TheStreetSweeper has requested comment from the inventor.
We haven’t heard yet about his motivation – doubts about the technology’s value, doubts of any upside left to the stock price, doubts about the company’s future, doubts about the absurd $685 million valuation or something else – but we believe it’s clear he wants to sell whatever he can.
*RenovaCare Background
We’ve written numerous articles warning investors of the mounting risks of RenovaCare (here, here, here here).
Our latest SA blog post details how RenovaCare recently filed, in our view, questionable SEC documents. They state that Mr. Rayat, through his solely owned Kalen Capital, had withdrawn his registration of 10.5 million shares … which, oh by the way, had been sitting around since 2006 (oops, they must have meant 2016).
Investors may have misinterpreted that filing, thinking that the majority shareholder from Canada was not getting set to sell his stock. But that’s wrong.
The current registration remains unaltered:
(Source: Company SEC filing )
So, more than 2 million shares currently registered by Mr. Rayat are still intact. Waiting to be sold … if the SEC issues a notice of effectiveness.
*Conclusion
Over-The-Counter’s skull-and-crossbones warning suggest a possible investigation may be launched or already in progress. At best, the warning indicates concerns of public interest revolve around the stock.
And the fact that the man behind RenovaCare’s flagship technology wants to sell his stock is yet another big cause for concern.
This is a very, very risky stock. In our opinion, RenovCare is the worst of the worst.
* Important Disclosure: The owners of TheStreetSweeper hold a short position in RCAR and stand to profit on any future declines in the stock price.
* Editor’s Note: As a matter of policy, TheStreetSweeper prohibits members of its editorial team from taking financial positions in the companies that they cover. To contact Sonya Colberg, the author of this story, please send an email to streetsweepereditor@yahoo.com.
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