Take-Two could face criminal indictment

Wedbush Morgan analyst Michael Pachter is advising caution on investment in Take-Two interactive, hinting that the recently issued grand jury subpoenas could signal criminal indictments for the publisher.

"We note that grand jury subpoenas are founded in criminal investigations," Pachter stated.

"As such, we believe that it is likely that one or more Take-Two employees may be subject to a potential criminal indictment."

The publisher announced on Monday that it had received grand jury subpoenas from the county of New York, calling for numerous documents for periods from October 1st, 2001.

It's unclear at this stage whether Take-Two as a corporation or any specific individuals are the target of the investigation, but Wedbush Morgan is advising caution given the renewed uncertainty for the company.

"It is impossible to speculate what the specific charges may be given the broad scope of the subpoenas, but we think that there is likely âprobable causeâ for the New York DAâs office to seek such subpoenas," Pachter added.

"We expect the grand jury investigation to take several months, and if indictments are issued, we believe that final resolution could take as long as two years."