“When consumers purchase a Perf Go Green product, they will be making a conscious decision to better the environment,” Mr. Tracy, the CEO, said then.
When Mr. Pataki joined the board at the end of that month, he got options to buy one million shares at half a dollar each, less than a quarter of its price then. A few weeks later, the Post article about the promotions was unflattering and cinematic. The paper said that the company’s CFO had done accounting for the Teamsters and that its chief operating officer, Michael Caridi, had “dabbled in real estate, concrete, security services and ship salvaging.”
It left out that Mr. Gargano, who became a Perf Go Green director a few days after Mr. Pataki, and was given options to buy 200,000 shares at half a dollar, had been profiled as a serial penny-stock board member in The New York Times. “While it is not illegal for someone to lend his prestige to a tiny, troubled company, it is unusual for someone with an important government position to do so,” the paper wrote in 2002, rattling off his connections to a golf-club maker that distributed Korean nasal sprays; an electrical-equipment distributor that shifted into an Eastern European health clinic operator; and a firm that tried to put James Dean’s likeness on socks.
“And it remains unclear,” The Times said, “why Mr. Gargano would be willing to risk his reputation by becoming involved in shaky companies.”
“Didn’t mean crap to me,” Mr. Gargano told The Observer this week about that article. “Every once in a while, someone would come to me. I’d either make an investment or maybe not, or be involved somehow, but they meant nothing to me.”
But what if the companies’ stock traded over the counter for a few dollars, or less? “There might have been some penny stocks. Of course! So what,” he said. “If I wanted to get involved with a couple of penny stocks because of people I knew, so be it. That’s my prerogative.”
At Perf Go Green, he knew Mr. Caridi, the chief operating officer. Reached at the company’s office this week, the executive said he, a secretary and a holding company were all that was left, though a spin-off of the company’s battery-product division will be announced soon. Mr. Pataki, he said, had been very helpful. “He was always very concerned and caring,” he said, “and always wanted to see the company succeed.”
“As board members, we did everything possible to give our advice for how the company could not only survive but better itself,” Mr. Gargano said. “We just got caught at a time when the economy really dropped severely.”
THE TWO ARE NOT the only political leaders who have dabbled in penny stocks. Four years ago, for example, the retired general and former presidential candidate Wesley Clark joined an energy and security firm called ViaSpace. He left two weeks later after complaints about the firm’s online stock promotions. That company has traded below $.02 since late January.