Technology minnow Quiktrak announced a trading halt this
morning following a fascinating day’s trading yesterday. In a single day’s
trade the stock fell 20%, without any news being released by the company until
it received a share price query from the ASX after the close of trade.

Quiktrak, which provides solutions for
monitoring and tracking vehicles, has enjoyed a strong run since emerging from
voluntary administration and being reinstated to official quotation on the ASX
on 10 August. On that day, the stock traded as low as 11 cents, before quickly
gathering support as the charismatic new Managing Director and majority
shareholder, Mark Pallister, issued a flurry of announcements regarding the
international opportunities the company was pursuing. On 19 September the stock
touched 40 cents, with trading then predominantly taking place in a 30 – 40 cent

But yesterday the tide
appeared to turn. After the share price peaked at 46.5 cents early in the day’s
trade, the stock headed steadily south, closing at 36 cents.This fall
represented a sharp contrast to recent trading in Quiktrak – which had attracted
fresh attention in the last week after announcing that Pratt family investment
vehicle, Thorney Holdings, would be investing $4 million in the company at 35
cents per share. Thorney involvement was seen by many as big-end-of-town
endorsement of Quiktrak and its turnaround.

It now appears that the market was spooked by an announcement appearing
on the ASIC website under the heading “Perth man appears in court on charges of
intent to defraud”. This article advised that one Mark James Pallister had
appeared in a Perth court, and stated that “ASIC alleges that on three
occasions, Mr Pallister falsified invoices and other documents, and made false
statements, to obtain monies totalling approximately $900,000.”

While the ASIC article was certainly the
subject of whispering in some corners yesterday afternoon, there is little
question that the broader market was certainly not fully aware of this
situation. While Quiktrak’s disaster management skills will be tested in coming
days and weeks, and Mark Pallister’s guilt is unproven, the key question raised
by this episode is how a listed company takes the view that its MD being charged
with three serious criminal offences did not warrant immediate disclosure to the
ASX? Further, trading in Quiktrack yesterday may warrant additional
investigation – my preliminary view of the day’s trading suggests that
substantial selling pressure emerged well before the ASIC article