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SDRC (Sydney Resources) is not only playing the PGM and REE angle, but now finding meteorite material in their "ores"? Their hand-held XRF sure is a fun toy, and seems to be a great substitute for actual assays. I kid of course, use of a field XRF instead of assays is idiotic. A few $30 assays would not only resolve the REE and PGM issues.....but take care of the meteorite "material" too. And ruin the narrative.
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174682696
How would you do that?
The only reason to invest in a company run by Natario is if you can profit from its collapse.
Lol ...that dam cleanup project is unrelated but will be in the courts for a long time. Civil probably but who knows, maybe criminal too.
Any thoughts on North Bay Resources pr today. Followed this one years. Debt laden, toxic financing but appear to be doing things right these days
Saw the SEC action vs Western Sierra et al today. No claims, wait until they get to the remediation project.
Oooh, look what I found
Botton right
insert-text-here
Where was his mug shot - state and or county? The man is a serial mess.
Nothing new, but maybe it is time to see how Mr. Natario is progressing through the legal system.
Nice work. Thank you for sharing. Do you have any more information on Joel James Natario?
Similar here. Mostly given up on IHUBers. I arrived in Pennyland with the birth of the Web in the 90s and soon encountered rubbish stock boards. My first thought at watching early players blow thru their savings was wondering "what the hell is wrong with these people?" It was like watching repellant creatures from a different universe. Even back that far I generally knew how to invest and almost everyone online was doing it 100% wrong... chasing fads and extreme long shots, ignoring quality. Never diversifying. Then came the crash in 2000 and virtually all of them were predictably cleaned out. Still, many never learned. There were a few suicides; many bankruptcies, divorces
"I sure don't own any non-reporting OTC stocks." With few exceptions my own holdings are even higher quality than standard blue chips. I mod a couple of large cap stock boards such as BRK where I post some things mostly for my later use.
I'm a retired lawyer and business owner with two sons. Have zero interest in gambling.
Bar, I never comment on stocks I own, but I will say that I sure don't own any non-reporting OTC stocks. I only "follow" OTC mining stocks because it is interesting watching how they promote a dream of riches to folks who know absolutely nothing about mining. And I know enough about geology, exploration and mining to instantly spot the BS.
Not to mention that here in Arizona, mining scams have not only left behind a trail of screwed over investors but they have caused serious environmental damage to the properties where they have staged their scams. I have seen the damage first hand and it pisses me off. Mining already faces an uphill battle with the public about the environment, even in a mining-friendly state like Arizona....and these crooks are not helping that image.
Thought of you as I watched the original "Stagecoach" on TV a few days ago. It was said to be filmed near Flagstaff which is where you live, I believe. Do you currently own or closely follow any mining stocks? Very rarely I'll glance at Newmont or Barrick which are about my only windows into that sector.
I'm not a trader. I tend to hold the bluest blue chips and index funds which has worked very well over the decades I've been investing in stocks (starting when I was in college). My son is a CPA; quality and audits are vital to me. BTW my son never audited a mining company.
I read a lot about investing -- especially academic papers -- but rarely make changes to my portfolio.
They only cheated a little bit......
Even NI 43-101 isn't perfect, even though many investors act as if it is. Any law or regulation can be circumvented by a determined individual or group, if they are determined enough. This one is a head-scratcher, though. Having one person solely in charge of receiving assay results and supplying them for entry into the property database is a clear issue, and an obvious source of potential fraud. This is a failure on the part of the company and their internal controls.
Red Pine plans new resource, downplays alleged assay fraud at Ontario gold project
https://www.mining.com/red-pine-plans-new-resource-downplays-alleged-assay-fraud-at-ontario-gold-project/
Red Pine Exploration (TSXV: RPX) says its ex-CEO did more reputational damage than harm to the company’s Wawa gold project in northern Ontario when he allegedly altered hundreds of drill core assays used in a resource estimate.
Quentin Yarie, the CEO from July 2015 before stepping down on Feb. 21 this year in an unrelated move, according to the company, oversaw a data collection process where he was the sole recipient of emailed assay results from Activation Labs. Red Pine alleges Yarie changed 532 assays out of 98,000 before forwarding them to staff for use in project modelling its 2019 resource update and marketing.
SIGN UP FOR THE PRECIOUS METALS DIGEST
“Look, in the end, it could have been a lot worse in terms of timing and the impact,” incoming CEO Michael Michaud said on a conference call on Wednesday. “We still believe in the potential of the asset. This is the reason why I joined Red Pine, this is reason why I’m here today and am looking forward to becoming the CEO.”
The scandal for the junior, which lost 60% of its share price when assay discrepancies were first revealed on May 1, may bring to mind the Bre-X Minerals fraud of the 1990s, but is on a much lower scale. Red Pine estimates the doctored assays aimed to marginally increase grade and could lower its Wawa project resource by as much as 12%. Bre-X involved blatant salting of core samples with incompatible gold nuggets.
“Certainly, though there was some manipulation of the assets, they were mostly embellishments,” Michaud said. “I’m not really terribly upset about the 10 or 15% because we’ll get that back easy.”
New resource
Red Pine suspended planned drilling and said it would trim costs at the site as it prepares to issue a new resource update with completely verified assays from as much as 70,000 metres in drilling since the last update. It didn’t give a potential completion date.
Shares in Red Pine rose about 20% to C$0.11 apiece on Wednesday morning in Toronto, valuing the company at C$21 million. They plunged to C$0.08 apiece from C$0.21 on May 1 when the company first described the assay inconsistencies in a release. They had traded in a range of C$0.16 to C$0.24 this year until May.
Red Pine referred the alleged fraud to the Ontario Securities Commission. It didn’t mention any legal action of its own against Yarie. He hasn’t replied to a request last week for comment from The Northern Miner.
The project lies beside the town of Wawa near the northeast shore of Lake Superior, about 220 km north of Sault Ste. Marie. The site hosts several historical mines that produced about 120,000 oz. gold.
Red Pine acquired the project in 2014. It produced a resource for the Surluga deposit in 2015 and later merged it with one on a historical mine area, Minto, in 2018.
New CEO
The company on April 22 announced the appointment of Michaud as CEO. He is to take office around July 19. The leadership change had nothing to do with the alleged assay manipulation, chairman and interim CEO Paul Martin (not the former Prime Minister) repeated on Wednesday.
“In all cases, the manipulation that occurred was to increase the grade,” Martin said on the call. “However, in virtually all cases, the manipulated grades were defendable at the time, based on among other things, the visual inspection of the core and assessment of the mineralogy, and one reason why the selective manipulations were not easily brought to light at the time.
“The changes were supported by the nuggety effect of the property as represented in the overwhelming number of unmanipulated assay results, often near where the selective manipulations were done.”
Red Pine staff first noticed a discrepancy between a certified assay result received from Actlabs and the corresponding assay result in the company’s database on April 29. An investigation determined the assay altering was done from the spring of 2015 until Jan. 30 this year.
Investigation
The company divided its investigations into two periods of assay results: 2014-2019 that resulted in the mineral resource estimates set out in the NI 43-101 technical report dated June 21, 2023 with an effective resource date of May 31, 2019.
The independent geologist in charge of the resource update, known in mining regulations as the qualified person, was Brian Thomas of Sudbury-based Golder Associates, now part of Montreal-headquartered WSP. Thomas declined to comment when reached this week by our sister publication, The Northern Miner. He referred questions to his WSP manager, Anas Tuijar, who didn’t return a phone message.
A second period covered 2019 to the present, during which assay results were disclosed through news releases.
For the first period, Red Pine determined that the inconsistencies mean a reduction in inferred resources for Wawa’s Surlaga and Minto deposits.
It estimated the Surluga area will lose an estimated 39,500 to 54,000 oz. (between 205,000 and 240,000 tonnes grading, on average, 6 to 7 grams gold per tonne) from inferred resources. That compares with the previous estimate of 2.4 million tonnes grading 5.22 grams gold per tonne. The indicated resource of 1.2 million tonnes grading 5.31 grams gold is not expected to change.
The Minto deposit loses 8,000 to 12,000 indicated oz. (between 30,000 and 40,000 tonnes grading 8.5 to 9.5 grams gold), and 16,000 to 20,000 inferred ounces (75,000 to 85,000 tonnes grading 6.5 to 7.5 grams gold). It was previously reported to hold 105,000 indicated tonnes grading 7.5 grams gold per tonne and 354,000 inferred tonnes grading 6.6 grams gold.
That "highly educated professional geologist" didn't sign off on the PR. That should tell you something.
Internet weirdo?
I trust the highly educated professional geologist in his assessment, much more than any random internet weirdo. I must admit, you are the advanced kind of payed stock bashers. So what is your target price for the current retracement? I want to make sure to buy at the low, before we break out to a new all time high.
Welcome, first-time poster!!!
Did you go through the math yourself? It's not difficult math but maybe the sampling methods and sample prep are confusing you?
Obviously you are smarter than any CEO and *independent* geologist that is involved in the project...clown!
Just tell us who you are working for, who is paying your poor attempts to create unsubstantiated doubt?
From a Nov. 8, 2023 PR by Sydney Resources (SDRC): https://www.otcmarkets.com/stock/SDRC/news/Sidney-Resources-Corporation-Reports-Assay-Results-and-a-Comprehensive-Evaluation-of-Recently-Discovered-Gold-Enriched-S?id=420598
Joel is very much back into the OTC world.....check out HIRU. He and his girlfriend appear to be on a criming spree.........
And I thought STAL was a sordid mess.
Wow....just.....wow....
That's even slimier than the actions of some of the other worst pinkie people.... Slavo.... Ekekija..Donald Jordan.....
Joel Natario can't stop criming. Remember Joel from Mining Global (MNGG)?? Here he is back at work.....maybe earning himself some prison time?
That stuff about the magical gold recovery system, Genesis.....is without any details. Just that it is fast, super efficient, and "green". Same old bullshit. I have yet to find anything about how it works. Therefore, I have to conclude that it is nonexistent and just another example of a scam mining company touting a scam gold recovery system.
Yes, Robert Garcia and Auric show up on many of the mining scams we have tracked over the years. Over and over. Even on Mexus, he was brought in by PT as an "expert" back in 2017, I believe. https://www.globenewswire.com/news-release/2017/10/16/1145909/0/en/Gold-recovery-expert-Robert-Garcia-joins-Mexus.html
regarding STAL and the "Genesis" process.
I found the Spanish text on their s-1 and ran it through a translator. Doesn't sound as impossible as that genius on the board was making it out to be?
Julio 20, 2023
Richard Carey
Star Alliance International Corp.
2300 West Sahara Avenue
Las Vegas, NV 89102
Hola Richard,
Actualización de la Planta “Proceso Génesis”:
A pedido suyo, les actualizamos los resultados de nuestra prueba Beta de Genesis.
Gracias al apoyo de Grupo Sastre en Guatemala, hemos experimentado exitosamente menas auríferas de óxidos y refractarios con nuestro proceso durante más de más de diez años. Y apegándonos a las nuevas políticas globales ha sido enfocado en que estas nuevas patentes de procesamiento sean ambientalmente amigables.
Genesis son dos procesos uno como pretratamiento de refractarios y otro para lixiviación. Ambos son un sistema de circuito cerrado que no daña el medio ambiente y prácticamente libre de emisiones con una alta tasa de extracción, que extrae metales preciosos en minerales de baja ley como 0,10 partes por millón, en menos de 48 horas.
Durante los últimos nueve meses, hemos probado este equipo, realizando numerosas mejoras en el equipo. Eliminado prácticamente todas las emisiones de la máquina, mejorado el tiempo general del proceso de extracción hasta tan solo doce horas con algunos minerales no arcillosos más el tiempo de carga y descarga. Actualmente estamos aumentando la escala de producción para aumentar significativamente la cantidad de mineral que puede ser procesado diariamente.
Como saben, hemos estado probando el equipo Génesis en la mina de Grupo Sastre en Guatemala. El equipo ha funcionado perfectamente, produciendo aproximadamente 2 gramos de oro por tonelada de mineral procesado. Esta extracción de oro es casi un 35% más eficiente que los resultados obtenidos con el uso del proceso tradicional de lixiviación y esto se logra en menos de 48 horas vs los patios de lixiviación que actualmente se utilizan, lo que supuso una mejora muy significativa respecto al proceso tradicional de lixiviación. Actualmente se está en pláticas para sustituir todo patio de lixiviación por nuestro proceso y finalmente estamos completando los expedientes para la patente que una vez sea presentada, estaremos listos para tener las verificaciones internacionales necesarias.
Estamos seguros de que una vez que se inviertan los fondos, podemos comenzar a fabricar equipos para la entrega a las muchas minas que pueden volver a ser viables usando nuestro equipo. Además, estamos dispuestos a comenzar con la colocación de Genesis en cualquier sitio de colas para extraer los remanentes y limpiarlas en cualquier parte del mundo.
Espero verlos en nuestras instalaciones de Guatemala tan pronto como sea posible.
Juan Lemus
At your request, we update you with the results of our Genesis Beta testing.
Thanks to the support of Grupo Sastre in Guatemala, we have successfully experimented with oxide and refractory gold ores with our process for more than ten years. And adhering to new global policies, we have focused on making these new processing patents environmentally friendly.
Genesis is two processes, one for refractory pretreatment and the other for leaching. Both are an environmentally friendly and virtually emissions-free closed-loop system with a high extraction rate, extracting precious metals in low-grade ores such as 0.10 parts per million, in less than 48 hours.
Over the past nine months, we have tested this equipment, making numerous improvements to the equipment. Eliminated virtually all machine emissions, improved overall extraction process time to as little as twelve hours with some non-clay minerals plus loading and unloading time. We are currently increasing the scale of production to significantly increase the amount of ore that can be processed daily.
As you know, we have been testing the Genesis equipment at Grupo Sastre's mine in Guatemala. The equipment has worked perfectly, producing approximately 2 grams of gold per ton of ore processed. This gold extraction is almost 35% more efficient than the results obtained with the use of the traditional leaching process and this is achieved in less than 48 hours compared to the leaching yards that are currently used, which represented a very significant improvement compared to to the traditional leaching process. Currently we are in talks to replace all leaching yards with our process and we are finally completing the files for the patent that once it is presented, we will be ready to have the necessary international verifications.
We are confident that once the funds are invested, we can begin manufacturing equipment for delivery to the many mines that may become viable again using our equipment. Additionally, we are willing to begin placing Genesis at any tailings site to extract the remnants and clean them anywhere in the world.
i just spotted gitreal on a new scam, STAL. Go check out its board. An SEC registrant. Claims enough in its filings to warrant being turned in to the SEC for fraud.
Found this in their S-1 https://www.otcmarkets.com/filing/html?id=16732216&guid=IzJ-kpLZGSfZdth
The mine talk begins about page 22. In several places they use the word reserves and place $ value on said "reserves"
Near the bottom of the report, gitreal, does Robert Garcia ring a bell? "Auric" surely does!
estimation of potential by-product metal targets of up to 729,000 ounces Platinum, 363.95 million pounds Nickel, 1.308 billion pounds Chromite, and 294,000 ounces Gold.
Estimation of potential by-product metal targets.......LOL.......pretty definitive language!!!
Another old mining scam is back to scamming.
https://finance.yahoo.com/news/north-bay-resources-inc-nbri-143000026.html
Extrapolating a property wide resource from a few samples. The oldest mining scam technique there is, but NBRI has been using that kind of fake "science" for decades.
From STAL's 10K, the language in this "technology" description reads like a hundred other mining scams we've all seen:
Brought to my attention today....another fake gold miner, with "gold backed crypto"!!!
https://investorshub.advfn.com/Star-Alliance-International-Corp-STAL-32113
They're an SEC-filer, walking a fine line with the BS in their filings. Their Genesis gold recovery system promises 400X faster gold recovery than standard leaching methods, and they promise 98% gold recovery. I wonder why the major gold producers aren't flocking to this new technology!!?
They are the exact same claims.
Lather, rinse, repeat.
People must fall for this utter BS because they are still doing it after 15 years. I really want to meet the people that actually believe those claims and find out how they can earn a living being so thick.
It is the same thing. This new "43-101" is nothing more than a cover letter attached to the original report. It's ridiculous. People fall for this, unfortunately.
Proven reserves??? Sheez......
Hilarious, ain't it? gitreal posted about this to me on the WSRC board.
You remember Texas Wyoming Drilling? They were pumping some Moapa claims also called "Yellow Jacket"....
I briefly skimmed that report to see if it might be more Moapa desert dirt scamminess.... Didn't bother reading that nonsense closely enough. Maybe you or gitreal might know if its in that same area. It surely sounds like it's the same... I know there have been munerous desert dirt scam attempts at pumping those worthless claims. Or have heard of the report author. I'd say he should have his license revoked.... if he even has one:
THE PROVEN GOLD RESERVE FOR THE YELLOW JACKET CLAIM #73A AS OF April 14,2023
Since all things are not equal in nature and since this is an alluvial fan I am going to use a value
per ton of this ore as a conservative 0.173 (50% of the historic value) ounces of gold to the ton
of this aggregate. Since this is only 40 acres the minable depth would be to only 100 foot and
with this depth considered and at that value the PROVEN RESERVE THAT I AM ASSIGNING TO
THIS CLAIM IS A TOTAL RECOVERABLE NUMBER OF OUNCES OF GOLD IS 1,119,527 AT TODAY’S
PRICE OF GOLD WHICH IS $2,010.00 EQUALS $2,250,249,270.00 PROVEN RESERVE
Phony "NI 43-101 Reports" are still a thing.
The British Columbia Securities Commission recently issued a warning about a phony NI 43-101 Technical Report issued by a Nevada company. And this company is a frequent flier on bogus reports. Yes, it is the exact same claims used by legendary fraud Texas Wyoming Drilling (now Bantec - BANT) to run their pump and dump about 10 years ago. Both the property and the company have since been recycled for use in new frauds.
Investor Alert: Nevada company makes unfounded claims of gold reserves
https://www.bcsc.bc.ca/about/media-room/news-releases/2023/36-investor-alert-nevada-company-makes-unfounded-claims-of-gold-reserves
Vancouver – The B.C. Securities Commission (BCSC) is warning investors about a Nevada-based company that has filed a technical report claiming a large reserve of gold.
In the report, Yellow Jacket Placer Project Partners & Associates, LLC said the mineral reserve had a very large “proven value.” However, investors should not rely on the report, which does not comply with national requirements. It does not contain supporting evidence for valid mineral resources, there is no basis for the dollar values assigned to the project, and it is not authored by a qualified person.
Yellow Jacket Placer Project Partners filed the report on SEDAR, Canada’s official site for most public securities documents and information filed by issuers, on April 21, 2023. However, the company did not file the report with any Canadian securities regulator, as required, and has no apparent connection to any jurisdiction in Canada.
The BCSC recommends that B.C. investors exercise extreme caution when dealing with any company that purports to release a technical report that does not follow the requirements of National Instrument 43-101 and its Form 43-101F1. The rule and the form establish standards for disclosure of scientific and technical information regarding mineral projects, and require that the disclosure is based on a technical report or other information prepared by or under the supervision of a qualified person.
The BCSC urges B.C. investors, agents, or members of the public who have been approached about investing in Yellow Jacket Placer Project Partners to contact BCSC Inquiries at 604-899-6854 or 1-800-373-6393 (toll free), via email at inquiries@bcsc.bc.ca, or by using the online complaint form.
I see that the "skill and luck" guy is involved.....which means some kind of shenanigans are going on.....
NB is a hell of a nascent mining scam.
Claiming 30 billion in reserves and promoted by one of the most vile stock criminals ever with a track record as long as the Chesapeake Bay Bridge.
It would be so easy for the SEC to crush AABB.....just a subpoena to force them to disclose proof of their (nonexistent) gold bullion. Or proof that their noteholder is a real person, and not affiliated with the company.
I'm sure you've heard about the EPA vetoing the Pebble! That's been a long fight for conservationists... and will be welcome for lovers of wild Alaska salmon....namely me!!
https://www.yahoo.com/now/whats-next-pebble-mine-now-144600194.html
https://www.worldwildlife.org/stories/epa-blocks-catastrophic-mining-project-in-bristol-bay-alaska?link=txt&utm_campaign=oceans&utm_medium=email&utm_source=advocacy-alert&utm_content=230202
Sure wish the SEC would come down on AABB.....
Great! Hopefully first of many prosecutions for fraudulent crypto!
They pushed the limits a bit too far - $10 billion in gold?? AABB only claims to have $30 million in gold.....but a lie is a lie.
SEC files charges against purported gold-backed crypto.
SEC Files Charges in a Crypto Asset Pump-And-Dump Scheme
Litigation Release No. 25537 / September 30, 2022
Securities and Exchange Commission v. Arbitrade Ltd., et al., Civil Action No. 1:22-cv-23171 (S.D. Fla. filed September 29, 2022)
https://www.sec.gov/litigation/litreleases/2022/lr25537.htm
The Securities and Exchange Commission today filed charges against Arbitrade Ltd., a Bermudan company, and Cryptobontix Inc., a Canadian company, and their principals, Troy R. J. Hogg, James L. Goldberg, and Stephen L. Braverman, and a so-called international gold trader, Max W. Barber, for perpetrating an alleged pump-and-dump scheme involving a crypto asset called "Dignity" or "DIG."
As alleged in the SEC's complaint, between May 2018 and January 2019, Arbitrade and Cryptobontix, through Hogg, Goldberg, Braverman, and Barber, issued announcements falsely claiming that Arbitrade had acquired and received title to $10 billion in gold bullion, that the company intended to back each DIG token issued and sold to investors with $1.00 worth of this gold, and that independent accounting firms had performed an "audit" of the gold and verified its existence. As alleged, Arbitrade claimed to have acquired the gold through a purchase transaction with Barber and his company, SION Trading FZE. In reality, according to the complaint, the gold acquisition transaction was merely a sham to boost demand for DIG, thereby allowing Hogg and Goldberg, with Braverman's assistance, to sell at least $36.8 million of DIG, including to U.S. investors, at prices fraudulently inflated by the public misstatements about the supposed gold acquisition.
The SEC's complaint charges the defendants with violating the antifraud and securities registration provisions of the federal securities laws. Specifically, the complaint alleges that: (i) Arbitrade and Cryptobontix violated Sections 5(a) and 5(c) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder; (ii) Hogg and Goldberg violated Sections 5(a), 5(c), and 17(a) of the Securities Act, and Section 10(b) of the Exchange Act and Rule 10b-5, and that Hogg is also liable as a control person for Arbitrade and Cryptobontix's violations of Section 10(b) and Rule 10b-5, and that Goldberg is also liable as a control person for Arbitrade's violations of Section 10(b) and Rule 10b-5; and (iii) Braverman and Barber aided and abetted violations of Section 10(b) Exchange Act and Rule 10b-5. The complaint seeks permanent injunctive relief, disgorgement plus prejudgment interest, and civil penalties against all of the defendants, and officer-and-director bars against the individual defendants. The SEC's complaint also names SION as a relief defendant seeking disgorgement plus prejudgment interest.
Including yours, soon. This board, which isn't interested in posts that pump garbage, is quite inactive of late. We should talk more about mining scams like AABB, BYRG, WSRC and others, though.
WTF is AMC thinking in buying a stake in seemingly defunct miner HYMC?
https://www.fool.com/investing/2022/03/18/why-the-heck-is-amc-entertainment-buying-a-gold-an/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
Check out today's news from WSRC, which has resulted in the first upward move since the June news about the SSMG mining claims. Up over 100%
Western Sierra Resource Corporation Announces Completion of Audits Reflecting $47 Million in Assets and Prepares S-1 Filing to Take Initial Steps Toward Nasdaq Listing
https://www.otcmarkets.com/stock/WSRC/news/story?e&id=2033315
I posted this on the board a couple months ago.
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=165423412
My post from today, in reply to stervc's granola post
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=166532691.
Hey Gitreal, new innovation in the sector - applied AI
Frederick Bauman
SEC Charges Attorney with Participation in IIIegal, Unregistered Securities Offerings
Litigation Release No. 25199 / September 8, 2021
Securities and Exchange Commission v. Frederick Bauman, No. 2:21-cv-1651-GMN-EJY (D. Nev. filed September 8, 2021)
On September 8, 2021, the Securities and Exchange Commission charged Nevada resident Frederick Bauman with playing a critical role as an attorney who facilitated the unregistered sale of millions of shares of securities by two groups engaged in securities fraud.
According to the SEC's complaint, between 2016 and August 2019, Bauman authored at least a dozen legal opinion letters falsely stating that certain shareholders were not affiliated with the public companies whose stock they held. The complaint alleges that in reality, the public companies and shareholders were under common control, and the shareholders were therefore affiliates of the companies. Stock held by an affiliate of a public company is restricted, and only small quantities of such stock can be legally offered or sold to the public without a securities registration statement in effect. A registration statement contains important information about a public company's business operations, financial condition, results of operation, risk factors, and management. According to the complaint, Bauman provided the opinion letters to transfer agents - entities that record the ownership and transfer of securities, and thus routinely track whether particular securities are subject to resale restrictions. The transfer agents allegedly relied on Bauman's false letters in treating shares of stock as unrestricted, and recording transfers on that basis. The complaint alleges that Bauman's letters thus facilitated sales of millions of shares that could not legally be sold to the public without a registration statement.
The SEC's complaint, filed in federal district court in Nevada, charges Bauman with violating the securities registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933. Without admitting or denying the allegations, Bauman consented to the entry of a final judgment permanently enjoining him from future violations of the charged provisions. In addition, Bauman consented to a five-year penny stock bar and a five-year conduct-based injunction that restricts his ability to prepare opinion letters. Bauman agreed to pay a $60,000 civil penalty, $13,000 in disgorgement, and $1,653 in prejudgment interest. The settlement is subject to court approval.
The SEC's case is being handled by Nita Klunder, Kathleen Shields, Eric Forni, Trevor Donelan, and Amy Gwiazda of the Boston Regional Office. The SEC appreciates the assistance of the Financial Industry Regulatory Authority.
https://www.sec.gov/litigation/litreleases/2021/lr25199.htm
For Release: Contacts: | Wednesday, August 24, 2011 |
FINRA Warns Investors of Gold Stock Scams
WASHINGTON - The Financial Industry Regulatory Authority (FINRA) issued a new Investor Alert called"Gold" Stocks-Some Investments Mine Your Pocketbook to warn investors about investment scams that promote gold stocks and to provide information on how to invest in legitimate gold investments. With the price of gold bullion at record levels, there has been a proliferation of blogs, websites, YouTube videos and Tweets centered on investing in gold. And while there are legitimate gold investments discussed online, FINRA is concerned that some investors may fall prey to gold-related investment scams.
These gold scams may center on inflated claims regarding the stocks of gold mining companies whose stock value is often based on gold reserves that are difficult to estimate, much less verify. For example, the Securities and Exchange Commission (SEC) took legal action against a mining company based in Florida for false press releases claiming that a mining project in Ecuador contained gold reserves worth more than $1 billion.
Gold investments may also be touted in free lunch seminars and pushed by boiler room operations. The SEC charged six individuals for running a recent Ponzi scheme that used investment seminars to bilk 3,000 investors across the United States and Canada out of $300 million. Separately, the Commodity Futures Trading Commission (CFTC) took three actions against precious metals firms, including charging a boiler room telemarketing firm that purportedly purchased more than $23 million of precious metals for their customers.
"Con artists are using the run-up in the price of gold as a hook to part investors from their money. Investors should think twice before investing in any gold investment promising exponential returns, or any company that claims it is a buyout target for other mining companies," said Gerri Walsh, FINRA's Vice President for Investor Education.
FINRA's Investor Alert cautions investors to be on the lookout for any pitch for a gold investment that:
"Gold" Stocks-Some Investments Mine Your Pocketbook also advises investors that while legitimate gold and ETF investments may be an acceptable diversification strategy, these investments can be quite volatile. A heavy concentration of gold investments can leave investors overly exposed and at risk of losing a substantial percentage of their money.
FINRA, the Financial Industry Regulatory Authority, is the largest non-governmental regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business - from registering and educating all industry participants to examining securities firms, writing and enforcing rules and the federal securities laws, informing and educating the investing public, providing trade reporting and other industry utilities, and administering the largest dispute resolution forum for investors and registered firms. For more information, please visit www.finra.org.
MINING INDUSTRY FRAUD
The problem of fraud in the precious metals mining industry continues to plague Arizona investors. The Arizona Corporation Commission's Securities Division has prepared this bulletin as a guide for the type of questions individuals should ask before investing in any mining program. All investments have risk, and no particular investment is guaranteed not to fail, no matter how diligently an investor has investigated the program prior to investing. Investigation prior to investment can reduce the risk of fraud.
One of the first questions you should ask before investing in a mining program is …
WHERE IS THE MINE LOCATED?
The exact location of the mine site is often not disclosed in many mining investment scams, yet surprisingly people continue to invest in these programs without knowing where the actual mining is to take place.
Press the people who are offering the investment to you (the offerors) for the exact legal descriptions of the site-do not accept a lay description such as "the proposed mine site is located approximately twenty-five miles northwest of Flagstaff, Arizona." That type of description tells you nothing at all about the true location of the site. If the offerors cannot or will not provide you with the exact location of the mine, DO NOT INVEST!!
Once you know the exact location of the mine site, your next question should be …
HAVE ANY ASSAYS BEEN PERFORMED ON THE ORE?
Usually, offering materials do provide what the offerors claim to be assays, but beware. Assays are only meaningful if they are based upon a systematic and scientific program of ore sampling. An assay based upon one or two ore samples is essentially meaningless it takes literally hundreds or thousands of separate ore samplings to properly evaluate the true potential of a mine site. Also be aware that even an accurate assay only tells you the amount of certain precious metals in a specific ore sample, not the amount of precious metals that can be economically extracted from that minesite or even that sample. No mining or refining technique can
economically extract all of the precious metals present in an ore body.
In reading assay reports, certain "red flags" signal that perhaps you are not receiving accurate information:
Reports indicating the presence of ½ ounce or more of gold per ton or ore. A mine site with ore values consistently this high would represent one of the richest finds of the century! Reports of precious metals not normally found together in the same ore. For example, while gold and silver are commonly found together, gold and platinum group metals are not.
Reports that traditional "fire assay" methods will not give an accurate reading of the precious metals content of the ore, while the offerors' "secret" or "revolutionary" methods will. A fire assay performed in a correct manner will give an accurate reading of the precious metals content of any ore sample.
Assayers who meet certain qualifications are registered with the Arizona Board of Technical Registration; call the Board (602-364-4930) to see if the assayer is registered, and if there is any information available concerning public actions against the assayer.
If mining is currently going on at the site, be sure to get copies of all production reports. Once you are satisfied that the ore at the mine site has commercial value, you are ready to ask the next question:
WHAT IS THE PRIOR MINING OR REFINING EXPERIENCE OF THOSE WHO WILL BE IN CHARGE OF THE MINING OPERATION?
Do not trust your money with people who have no prior experience in the mining industry. Mining is a highly skilled and technical profession, a field that cannot be profitably pursued by amateurs. If possible, check out ALL of the mining and business references provided by the offerors. If they have not provided you with any references, require them. If they have no references they can give you, or if their references are so vague that you cannot check on them, then the operators may not have any mining or refining experience.
You should next ask …
WHAT IS THE FINANCIAL CONDITION OF THE PEOPLE WHO WANT MY MONEY?
Are the people to whom you will be giving your money financially solvent? Are they a newly created company with little or no assets? Do they personally have any financial stake in the venture, or are they merely a group of people who want to enter a high risk venture using other people's money? You don't know the answer to these questions until you see balance sheets, profit and loss statements, and other audited financial documents. Once again, if these types of financial statements are not provided to you, require them.
Remember that the most meaningful financial statements are those that have been prepared by an independent certified public accountant.
Your next question is …
HAVE ANY OF THE PERSONS ASSOCIATED WITH THE OFFERING BEEN THE SUBJECT OF PAST ACTION TAKEN BY A GOVERNMENTAL AGENCY OR PRIVATE PARTY?
Obviously, you want to know whether the people to whom you will be giving your hard-earned money have a history of law violations, civil lawsuits, or bankruptcies. Just as obviously, if the people who want your money do have such histories, they will naturally be reluctant to reveal their prior legal problems to you.
Contact the Securities Division for information about federal
or state securities law actions. Also, contact the mining
department, any other appropriate state agencies, and the Better Business Bureau. If the mine site is located on public land, contact the state's land department, or federal agencies such as the Bureau of Land Management or the Forest Service.
Review civil and bankruptcy court records. (Important numbers are listed on the last page of this bulletin.)
Having satisfied yourself that the people to whom you may
be giving your money do not have a history of law violations,
you should next ask …
WHAT ARE THE COSTS AND OBLIGATIONS INVOLVED IN INVESTING IN THE PROGRAM?
How much is the investment going to cost you? What are you to receive for your money? A certain tonnage of ore? A certain number of ounces of precious metals? Stock? A pure cash return on your investment?
How is your investment to be made? In a lump sum, or in the form of periodic payments? Could you be required to provide additional money at some time in the future? Under the terms of the offering, must you meet any obligations or perform any duties other than making the investment? Once you understand the costs and obligations involved in investing in the program ask …
WHAT ARE THE RISKS INVOLVED IN INVESTING IN THE PROGRAM?
All investments have some amount of risk involved in them,
and the general rule is this: the greater the potential profit,
the greater the potential risk.
What assurance do you have that the offerors will not simply take your money and run? Is your investment secured by real property or equipment? (NOTE: It is a "red flag" if the promoters are guaranteeing that you will not lose money, whether they are offering your money back on demand or guaranteeing that a certain amount of gold is available.)
If the price of gold drops suddenly, would it still be feasible to mine? Does the mining program depend upon a continuous stream of investment capital in order to operate the mine? If it does, what if the stream of money decreases or is cut off? It can take millions to begin a viable mining operation.
Do the mine operators have any conflicts of interest that could cause them to devote less than their best efforts to the mining project?
Mining is inherently dangerous. If a worker gets injured at the mine site, could you be held financially responsible? If an injured worker sues the mine, is there enough liability insurance to cover the worker's claims?
If you are satisfied that you completely understand the risks
involved in investing in the program, your next question is …
EXACTLY HOW ARE THE OFFERORS GOING TO USE INVESTOR PROCEEDS?
You need to know just where your money will be going. Would some of your investment funds be used to pay sales commissions to the offerors or others? Towards salaries, legal fees, or other administrative expenses? How much of your investment money is actually going directly into the mining or refining of ore? What types of fees are going to be paid to the offerors? For what services? Arizona securities law requires that full disclosure be made to investors of the exact uses of proceeds in the venture. Finally, before you reach for your checkbook, you need to ask one more question…
CAN I AFFORD TO MAKE THIS INVESTMENT?
Be guided by your head, not your heart. Do not let "gold fever" lead you down an empty mine shaft. The basic warning to keep in
mind when considering any investment, including mining investments, is this:
IF YOU CAN NOT AFFORD TO LOSE ALL OF YOUR INVESTMENT, YOU CAN NOT AFFORD TO INVEST!
Arizona Important Contact Information
Arizona Corporation Commission's Securities Division 602-542-0662
(Toll free within Arizona) 1-866-VERIFY-9
Arizona Attorney General's Office Complaint & Information Center 602-542-5763
Arizona Department of Mines and Mineral Resources 602-255-3795
Arizona Mine Inspector's Office 602-542-5971
Arizona Department of Environmental Quality 602-542-4791
Arizona Board of Technical Registration 602-364-4930
U.S. Bureau of Land Management (Phoenix) 602-417-9200
U.S. Forest Service (Phoenix) 602-225-5200
Better Business Bureau (Phoenix, Flagstaff, Yuma) 602-264-1721
(Tucson and Southern Arizona) 520-888-5353
For additional information on how to investigate any offering before you invest, see "How Do I Verify Before I Buy Investments?," available on the Securities Division's web site
at: www.azinvestor.gov
(Click on Investor Info Center) or call 602-542-0428.
http://www.azinvestor.gov/InfoCenter_Docs/guide%20to%20mining%20investments.pdf
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