Investors dump shares in firm where whistleblower Snowden worked
Technology consulting firm Booz Allen Hamilton Holding Corp. relies on government contracts for its revenue
Shares in the company that employed whistleblower Edward Snowden fell by the highest amount in four months Monday as investors reacted to the unfolding privacy scandal.
Booz Allen Hamilton Holding Corp., a technology consulting firm that relies on U.S. government contracts for the vast majority of its revenue, lost more than four per cent on the New York Stock Exchange Monday. The shares were off more than 80 cents to $17.20 US at midday.
If it holds, that will be the company's worst one-day performance since January.
Over the weekend, 29-year-old Snowden outed himself as the whistleblower who informed journalists of a massive U.S. government program known as PRISM, which allows Uncle Sam to monitor emails, phone messages and bank information of virtually anyone on a scale far larger than previously thought.
Currently in Hong Kong, Snowden says he has worked as a computer analyst for the National Security Agency through a variety of government contracts for more than four years.
"I, sitting at my desk, had the authority to wiretap anyone, from you or your accountant to a federal judge to even the president if I had a personal email," he told British newspaper The Guardian. "Much of what I saw … really disillusioned me about how my government functions and what its impact is in the world."
Booz Allen confirms Snowden was employee
Snowden's career included three months in Booz Allen's Hawaii offices, where Snowden alleges he had sweeping access to electronic records of virtually every U.S. citizen.
In a statement on its website Sunday, Booz Allen confirmed that Snowden did work for them and pledged to work closely with investigators looking into the matter.
"Booz Allen can confirm that Edward Snowden, 29, has been an employee of our firm for less than three months, assigned to a team in Hawaii," the company said. "News reports that this individual has claimed to have leaked classified information are shocking, and if accurate, this action represents a grave violation of the code of conduct and core values of our firm. We will work closely with our clients and authorities in their investigation of this matter"
Booz Allen took in $5.7 billion US in revenue last year, 99 per cent of which came from U.S. government contracts.
Private equity firm The Carlyle Group took the company public in 2010 and owns 67 per cent of the stock.
Stifel Nicolaus analyst William Loomis said in a note to investors that the incident is "embarrassing" for Booz Allen, but not likely to have a lasting impact, since it was just one employee who was employed there only briefly.
He kept a "Hold" rating on the stock.
Prior to Monday's sell-off, Booz Allen shares had gained more than 25 per cent in 2013.
With files from The Associated Press