Today: Jul 22, 2024

Former CEO of Medical Device Startup Stimwave Charged with $41M Fraud

7 months ago

The Securities and Exchange Commission (SEC) has charged Laura Tyler Perryman, the former CEO and co-founder of medical device startup Stimwave Technologies, with defrauding investors out of approximately $41 million. The SEC alleges that Perryman made false and misleading statements about one of the company’s key medical device products, which included a fake, non-functional component that was implanted into patients’ bodies. The device, called a peripheral nerve stimulation (PNS) Device, was supposed to treat chronic nerve pain by delivering electrical signals to targeted nerves. However, the SEC claims that Perryman misrepresented the device to investors, stating that it was FDA-approved and the only effective device on the market.

The complaint also alleges that Perryman made false and misleading statements about the company’s historical revenues, revenue projections, and business model. When the fraud was uncovered in 2019, Stimwave voluntarily recalled the PNS Devices and eventually filed for bankruptcy. The SEC is seeking permanent injunctions, disgorgement plus prejudgment interest, a civil penalty, and an officer and director bar against Perryman. In a parallel action, the U.S. Attorney’s Office for the Southern District of New York has filed criminal securities fraud charges against Perryman.