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12/21/15

Minera IRL and power of attorney (from IKN345)

I've been asked to put this small section of yesterday's weekly on the blog. So here it is.

The new board shows its reluctance to change matters
We could go round the houses on this, but to cut to the chase Power of Attorney (POA) was awarded to Jaime Pinto and (IRL Ltd controller) Carlos Yrigoyen by the old board of directors so that Pinto (in particular) could act on behalf of the board.

Sidebar: Power of Attorney (3): A written document in which one person (the principal) appoints another person to act as an agent on his or her behalf, thus conferring authority on the agent to perform certain acts or functions on behalf of the principal.

It gives him the power to do what he wants, when he wants, with the IRL assets. The idea behind the POA was related to the gaining of control of the subsidiary, Minera IRL SA, because the IRL Ltd (Team Hodges) people want to transfer all assets out of the subsidiary and into the mother ship company and from there, they can do what they want with them.

Now that’s fair enough you might say and if you believe the Team Hodges people they were only going to do that to clean up the structure and take the assets away from an overly powerful and quasi-independent subsidiary that was up to no good. However, that argument suddenly unravels when you realize that the new board of directors has not revoked the POA to Jaime Pinto. It also gets a different light when you consider the way Pinto really operates (see below for more on that).

Yes folks, that’s right: Under any normal change of board, the first thing that would happen is that powerful legal devices such as POA would be taken away from an outgoing board member immediately. But in the crazy world of IRL and because of the obstinacy of the two Team Hodges people left on the board of directors, Jones and Fryer, the person that you voted out by a tally of 92% to 8%, Jaime Pinto, still has full control over the assets of Minera IRL Ltd.