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11/21/15

Minera IRL Ltd (Team Hodges) has published its News Release


And they have no idea what they've just done. IKN strongly recommends that you read their news release, take in exactly what they've stated and in particular pay attention to the words of Jaime Pinto, non-executive chair of Minera IRL Ltd, repeated here:

Jaime Pinto, Chairman, said "we are truly sorry that the subsidiary's management team and community relations team have acted in an unprofessional manner and have used the Community issue as a way to advance their personal agendas. We have an Extraordinary General Meeting of shareholders scheduled for November 26, 2015, and while this new information has come to light late, I hope shareholders will carefully consider this announcement, as well as all previous announcements by the Company, before they cast their final vote."

That's because this fool has no idea what he's just done to himself. He's just committed professional suicide and doesn't even know it yet. 

He'll know tomorrow. And so will you.

Minera IRL (IRL.to) (MIRL.L): How Team Hodges wastes shareholder money

IKN learns, this Saturday afternoon 2pm local time, that Minera IRL Ltd, i.e. Team Hodges, has taken a full page advertisement in tomorrow's Sunday edition of Peru's national newspaper "El Comercio" in order to proclaim whatever it is they want to proclaim.

This despite the fact that the limit date for proxy submissions for any shares held in Peru is November 20th, i.e. yesterday.

The full page advert in the Sunday edition of El Comercio is costing the company U$21,500.


The criminal charge faced by Jaime Pinto (in English)

As promised yesterday, here's a paste-out of the criminal charge faced by Jaime Pinto for corruption. It's long, so it gets to clutter up the blog during our lower-traffic weekend days. It's in English, just for fun.

We must underscore that as in any other country, the assumption of innocence until proven guilty is sacrosanct. That Jaime Pinto faces a criminal charge that carries a penalty of minimum three years and a maximum of fifteen years in prison does not yet mean that he's guilty of the charges.

The only thing I've changed is that I've edited out the name of the person and the DNI number (national identity card number) of the person who has brought the charges. However, I can confirm that to the best of my knowledge the person has nothing to do with Minera IRL. It is a totally separate case. I thank my source in the Peruvian judicial system, also unconnected to Minera IRL, for providing IKN with the document.

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FILING OF A CRIMINAL COMPLAINT FOR THE CRIME OF COLLUSION

SIR PROVINCIAL CRIMINAL PROSECUTOR SPECIALIZED IN CRIME OF CORRUPTION OF GOVERNMENT OFFICIALS:

(Name of person), identified with ID Card No. (), domiciled for service of process at box () of the Lima Bar Association, fourth floor of the Courthouse; I thoughtfully say to you:

I.                   PRAYER FOR RELIEF

I FILE THIS CRIMINAL COMPLAINT against Mr. JAIME PINTO TABINI with ID Card No. 07809274, domiciled at Calle Los Nogales 362, dpto. 201, San Isidro, and e-mail jpinto@pintoabogados.com; for committing the crime of Illegal Collusion, which is a crime provided in and punishable under Article 384º of the Criminal Code, committed against the State. Consequently, I REQUEST to your office to kindly admit this complaint to proceedings, to dispose the appropriate investigations and, in due course, to issue the corresponding fiscal judgement whereby the CRIMINAL LIABILITY of persons who are identified as perpetrators or involved participants of the facts matter of complaint is established; in view of the factual and legal arguments, which I explain below.

II.                       PRIOR ISSUE: THE NOTION OF PUBLIC OFFICIAL AND EFFECTS

1.                 As part of the characteristics configuring the administrative concept of public official[1], criminal law relaxes the requirement of the endowment so that it assimilates the notion of public official to contracted agents and those who are occasionally involved in public service and to those who have lost their status of law officials. Likewise, it rationally adapts the other requirements to match the particular individuals linked by specific forms (temporary and occasional) in the management of public funds, or of social commitment[2]. Thus, we have that the criminal legal concept of public official has a wide, open and suitable regulatory conceptualization in accordance with the purposes of protection established in the criminal law.

2.                 Article 425º of the Criminal Code contains a strictly administrative concept in its first level by pointing out in the first paragraph that public official are those who are included the administrative service, for then being extended to those holding a political or trust positions, those who exercise, even if they are elected by popular decision, anyone who regardless of the labor regime which he / she is in, maintaining employment or contractual ties of any kind with entities and agencies of the State and that by virtue of that, performs functions in such entities or agencies, the administrators and trustees of seized or deposited wealth by relevant authority, even though they belong to particular individuals, the members of the Armed Forces and National Police, and others specified by the Political Constitution and the law.

3.                  Whenever the respondent had the status of a public official at the time of incurring in the facts alleged; the extension of the stature of limitation provided for in the last paragraph of Article 80 of the Criminal Code shall be applied, which states:

 “Article 80. - Statute of limitation for criminal action
The criminal action is time-barred in a time equal to the maximum penalty provided by law for the crime, if it involves deprivation of liberty.
(…)     
In cases of crimes committed by public officials and servants against property of the State or bodies supported by it, or committed as part of criminal organizations, the statute of limitation is doubled.” [Our emphasis]


III.              BACKGROUND

1.     The Brady Plan was a strategy adopted in 1989 to restructure the debt of developing countries with commercial banks in the scope of Latin American debt crisis that was based on operations for reducing debt and the service of debt voluntarily made under market conditions.
In 1996, the Peruvian government approved the ‘Brady Plan’ which, according to the research by CEFID-AR, “considered a procedure for recalculation of interests and the exchange of the due and unpaid debt for new debt securities: Brady bonds,” however the commission headed by former Congressman Rafael VALENCIA-DONGO in 2002 found several cases of corruption in the renegotiation of external public debt between 1990 and 2000.
2.            On September 26 of that year, Elliott got from the Brussels Court of Appeal an order to seize the payment of interest on international bonds that Peru had scheduled to make through Euroclear - financial services company located in Belgium - and even though no funds were awarded, it threatened the country to fall into default, said US attorney Mark Cymrot.
3.            SBC, which bought Peruvian debt as financial agent of Peru since 1994, sold external debt securities valued at US$ 20 million to Elliott Associates, LP for US$ 11.4 million in 1996, breaching the contract that prevented the negotiation of securities without giving communication to the Peruvian government.

IV.                    FACTUAL BASIS FOR THIS COMPLAINT

1.            JAIME PINTO TABINI joined the Ministry of Economy and Finance (MEF) in 1992 during the presidency of Carlos Boloña. PINTO TABINI said he only looked at the operations made by the Swiss Bank Corporation (SBC) on behalf of Banco de la Nacion through the Investment Program, so he had total lack of awareness of other operations made by the SBC. On September 30, 1996, he retired from MEF; but before his dismissal he left the team of external debt to continue working as a legal adviser of the MEF; having started a relationship with Elliot Associates, LP. That is, we are aware of the voyages of Mr. Pinto to the United States in 1996 when the problem with Elliot began. On the other hand, some witnesses interrogated by the Investigation Committee of the Peruvian Congress noted that when Elliot Associates LP bought the papers of the Peruvian debt, the MEF, in the person of Jaime Pinto, received the information from the operation in the same way as the whole information from the operations made by the Swiss Bank were received, although Pinto has denied this information in his defense before the Commission.
2.            Now, Mr. Pinto would have retired from the MEF on bad terms according to the press of that time due to a hard argument with Jorge Peschiera, Team Head. Then he began to work in the multinational company Telefonica; and later in the Estudio Muñiz, Forsyth, Ramirez, Pérez - Taimán y Luna Victoria. It is important to note that in these circumstances he went back to “visit” the MEF to talk to Jorge Camet and inform him that Elliot was willing to negotiate the debts it had with Peru, being that from February 1998, Jaime Pinto started to provide legal advice to Elliot Associates LP in the trial against Peru. Indeed, attorney Mark Cymrot (Representative of Peru) request in the United States that Mr. Jaime Pinto is moved away from representation since he had privileged and confidential information from the Ministry of Economy and Finance with regard to Peruvian external debt.
3.            Certainly, the SBC by contract could not sell papers of the Peruvian debt to a third party; and in the case of the transfer of papers of a third party, it should inform this to the Peruvian Government. Within the clauses of the contract it was stated that there was a term of 24 hours -after entering into an agreement for making the investment- to inform the Peruvian government who were the owners of promissory notes that it was buying back. The SBC committed the crime of use of privileged information on its own behalf since it bought at a lower price before the recognition as public debt. Moreover, according to paragraph 7 of the contract, it states that the SBC could not buy or sell by its own. The SBC kept this purchase between 13 and 15 months and then sell it to Elliot Associates, LP and not to the Peruvian Government, its fast track customer. That is way there was a breach of the contract with the Peruvian government, because it fouled by not changing the registration within the normal deadlines established (20 days).
4.            With regard to Peru, the entity who claimed for this sale was the General Directorate of Public Credit and not JAIME PINTO (who was in charge of receiving the report of all investment operations made by the SBC on behalf of Banco de la Nación, being aware of the sale made by the SBC to Elliot) and the Special Commission of Banco de la Nación (who had been in constant contact with the SBC). Paradoxically, Jaime Pinto was appointed by the MEF as the representative of Peru at the IDB since March 2001.
5.            As a result of the unlawful behavior of JAIME PINTO TABINI, Elliott Associates, LP - an investment fund founded by Paul Singer - received more than US$ 58 million from the Peruvian Government in September 2000, after winning a lawsuit in New York where it demanded the payment of US$ 66 million for a Peruvian debt that bought at an almost six times lower price.
6.            In 2003, the investigating commission presided by former Congressman Ernesto Herrera recommended to sue Jaime Pinto together with the Swiss Bank Corporation (SBC), after determining that the purchase of debt, by the so-called ‘vulture fund’, generated a damage to the State for the value of 50 million dollars, but these allegations were not raised. Jaime Pinto, responsible for supervising the contracts of the SBC (with whom it was in permanent contact), not only allowed this operation to be made but avoided to claim when the Peruvian government became aware of the purchase.

V.                                   LEGAL GROUNDS

A.     CRIME OF COLLUSION

1.            The crime of collusion provided for and sanctioned in Article 384° of the Criminal Code would have been committed by as follows:
Art. 384.- The official or public servant who, in contracts, supplies, auctions, price competitions or other similar transaction in which he is involved because of his office or because he is part of a special committee, defrauded the State or any State entity or agency, according to the law, arranging with stakeholders in agreements, adjustments, liquidations or supplies shall be punished by imprisonment of not less than three nor more than 15 years.”
2.            The core of the illegal behavior is defrauding the State or State entities or agencies by arranging with stakeholders in agreements, adjustments, liquidations or supplies. The typical behavior in relation to the times of execution and consummation is thus given by the willful arrangement with consequent patrimonial defrauding to the State interests. This defrauding involves any flagrant infringement of the duties attached to the position or to the orders of the special commission entrusted to public officials and servants. These make use of the powers to illegally vary, circumvent or replace the state or parastatal interests and claims, which by law must ensure and safeguard, opting instead for preferring different and even for prioritizing individual claims harmful to those that are typical of the public administration.
3.            What the active subjects violate with their behavior -which can be for action or omission- is the necessary state partiality in management, making it become a personal partiality of stakeholders, which is incompatible with the charge or commission and involves affecting the economic interests of the State or State agencies.
4.            To defraud the State and its agencies or entities, is thus, result of the violation of the special roles assumed by linked individuals, with consequent violation of the confidence given by the society and the State by deceiving the public interest. The official or servant assumes roles incompatible with those of professionally negotiating as it is a representative part of the public administration which contradict its powers or orders of the commission and affect the patrimonial expectations and interests of the State.

THEREFORE:
To you, Sir Prosecutor, I REQUEST: To kindly admit this complaint to proceedings, providing the relevant investigations, for the purpose of, in due course, determining the CRIMINAL RESPONSIBILITY of the respondent.

FIRST ADDITIONAL PLEADING: Find attached simple copy of the identification card of the claimant.
SECOND ADDITIONAL PLEADING: I request that, once this complaint is admitted, you kindly call for the following means of investigation:
1.     Investigative statement of the respondents.
2.     Investigative statement of the aggrieved party.


Lima, November 17, 2015


[1] The doctrine of public and administrative law states that to consider a person as a public official, he / she must have the following characteristics: a) origin of the title, b) formality in the exercise of function acts, c) existence of civil service, d) remunerated activity, e) state representative and f) power of decision.
[2] ROJAS VARGAS, Fidel. Delitos contra la Administración Pública. Editorial Grijley. 4th Edition. 2007. Lima, pp. 140.

11/20/15

Carpathian (CPN.to) finally liquidates its shareholders

  • Carpathian Gold (T.CPN, C$0.29, 555M SO, 590.5M FD, C$161M MCap, www.carpathiangold.com)— We've written quite a bit about this company. The bottom line is simple: the company is trading at a discount to the value of the gold mine, is on track to deliver on time and on budget in Brazil, and on top of this, it has a huge gold-copper resource in Romania for which the market is giving it no value. The stock will almost certainly rise based on the former and could eventually become a 10-bagger based on that alone, given the low starting point. It's hard to put odds on the Romanian blue sky, but whatever they are, free is a great price, and the consequences of success with that project would be huge.

And here's tonight's news on the stock. Say buh-bye to the last vestiges of your CPN money, Casey Research subscribers:

Carpathian Gold Inc. Announces Restructuring

TORONTO, ONTARIO--(Marketwired - Nov. 20, 2015) - Carpathian Gold Inc. (CSE:CPN) (the "Corporation" or "Carpathian") advises that, as a result of an agreement (the "Option Agreement") entered into between Macquarie Bank Limited ("Macquarie") and Brio Gold Inc. ("Brio"), Brio has been granted an option to (i) acquire all of Macquarie's rights and interests in the project loan facility, the gold purchase agreement and the gold sale and purchase agreement and related guarantees previously entered into by Macquarie and the Corporation, Mineracão Riacho dos Machados Ltda. ("MRDM") and certain other subsidiaries of Carpathian (collectively, the "Obligors"), and (ii) receive from Macquarie an assignment of Macquarie's security in respect of the foregoing agreements (all of the foregoing agreements and the security are collectively referred to as the "Financial Assets").
Pursuant to the Option Agreement, Macquarie has agreed to forbear from exercising any default-related rights, remedies, powers or privileges, or from instituting any enforcement actions or collection actions against the Obligors under the Financial Assets until the earlier of (i) the exercise or early termination of the Option Agreement and (ii) February 15, 2016. Under the Option Agreement, to the extent that cash flows from the Project are insufficient to meet ongoing costs and expenses, Macquarie has agreed with Brio to continue to provide funding to MRDM, subject to the terms and conditions set out in the Option Agreement. Any drawdowns requested by MRDM under the project loan facility remain subject to the discretion of Macquarie.
Furthermore, the Corporation has entered into an agreement with Brio and Macquarie (the "Restructuring Agreement") whereby the Corporation and Brio have agreed that, in the event Brio exercises its option to acquire the Financial Assets under the Option Agreement, the Corporation will work with Brio with respect to a restructuring procedure to be initiated by Brio with the objective of transferring 100% ownership of MRDM's Riacho dos Machados gold project in Minas Gerais, Brazil (the "Project") to Brio (the "Restructuring"). Pursuant to the Restructuring Agreement, Brio will deliver to the Corporation and its directors a full release and discharge with respect to any liability under the Financial Assets, including the Corporation's guarantee thereof. Following the Restructuring, the Corporation shall continue to own its Romanian assets, but shall have no ownership or interest in, or liabilities in respect of, MRDM or the Project.
As well, upon closing of the Restructuring, Brio has agreed to a US$1 million subscription of common shares of the Corporation, the whole at a price to be mutually agreed and subject to the requirements of the Canadian Securities Exchange.


The Friday OT: Henry Rollins; Liar

Dedicated to James.



"I really identify with you so much"

Look folks, I know you're all bored stiff with the Minera IRL thing, but...

...you're going to let me have just a couple more days' worth of coverage, because between now and Monday morning there are going to be some humdinger developments in this whole affair. The false world of Team Hodges really is falling apart this time. Wonderful to see.

UPDATED: The Mali hotel situation and B2Gold (BTG) (BTO.to)

We hear that at least one executive of BTO is stuck inside the Radisson hotel in Mali where the hostage event is taking place. Here's a wish for safety for one and all in there.

UPDATE: This is good.

B2Gold Corp. confirms that two employees were staying at the hotel at time of the incident. Both employees were safely extracted by anti-terrorist soldiers between 15:30 and 17:00 local Bamako time and are safe. T

BTO's full NR here

So now we know: "Mineral Bank" is just a fancy new way of saying prospect generator

Style beats substance every day:

TERMS OF THE AGREEMENT:
Under the Agreement, Peñoles may earn-in up to a 100% interest in the Properties by paying to First Mining a total of $1.5 million over five years. If Peñoles completes the acquisition of the Properties, First Mining will retain a 2% net smelter return (NSR) royalty, which may be purchased by Peñoles. All mining concession taxes and assessment work for these properties as required by law, will be paid by Peñoles.

full thing here

Chart of the day is...

...copper, weekly:




Glencore cutting production changes everything, they said.

Three more from Minera IRL

First up, your humble scribe has managed to get his grubby little hands on a copy of the criminal charges filed against Jaime Pinto on November 17th 2015. It's a big long document, so rather than clutter up the blog with it today I'll stick it up here tomorrow Saturday, when less people come around.

Next, this morning the Team Hodges scoundrels trying to cause crap in Ollachea have this morning been trying to get more signatures to their list by using a megaphone and calling for support in the local Friday market, according to my source in the town. He says it's important to underscore that they're now trying to get any old signature and not even checking on whether the person is from the town (on market days the town swells with people from outlying areas. This is because they could only manage to get 20 signatures from the "empadronados", i.e. the approx 750 people with full voting rights on all community affairs in Ollachea. Yup, Jaime "NOT HODGES!"Pinto is that desperate to get his fake paper out to you. And by the way, the President of the Ollachea Community isn't in town, as his wife is ill in hospital and he's had to be with her this week in the city of Juliaca...funny how they manage to take advantage of the absence of him too, isn't it?

Lastly, here below is the latest NR from Minera IRL SA (Team Benavides) explaining more about the dirty tricks being used by Team Hodges in Ollachea. This was published in the wee small hours of this morning, before the marketplace fun. And here's the latest form the liars at Team Hodges, linked here, that desperately tries to spin what little they have into "the community is split".

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The Board of Minera IRL Limited Promotes Conflict in the Community of Ollachea

Lima 19 November 2015:  Minera IRL wishes to report that the Board of Minera IRL Limited is promoting agitation and conflict in the Community of Ollachea, with the goal of destabilizing peace in order to have a group of community members sign a declaration in their favor, one week before the EGM of Company shareholders on the 26 November.
Mr Jaime Pinto, non Executive Director leading the Board of Minera IRL Limited, is under criminal investigation for charges of corruption and generating losses of US$50 million for the Peruvian State.
The investigation is in process against Mr Pinto before the 2nd Provincial Criminal Prosecutor's Office which specializes in corruption charges for public employees.  This investigation relates to the loss of large sums for the purchase of external debt during Mr Pinto's time of employment with the Peruvian Ministry of Economy and Finance.
Also, during his time as CEO of Mantaro Peru SAC, Mr Pinto utilised divisive practices in neighbouring communities to the Phosphate Exploration Project in Junin, the Project remains paralyzed indefinitely.
The Board of Minera IRL Limited is currently promoting division in the Community of Ollachea, failing to use the proper channels of the elected Board of the Community, or to respect the Community's statements.  These actions have been reported to the National Office of Dialogue and Sustainability of Counsel to the President and the Office of Social Development in the Ministry of Mining and Energy.
Through meetings with a small group of community members in Lima, distribution of leaflets, the convenient editing of private meetings with the Community and looking for signatures in the streets of Ollachea, the Board is promoting the removal of the actual President of the Community, generating insurgency and disrespect for the decisions of the Community Assembly.
The small group of community members who met in Lima with Mr Jaime Pinto,(as reported in their press release of November 13), were instructed by Mr Pinto to distribute his letter, which accuses the Community of being manipulated, and questions their decision
This leaflet and press release from the Board of Minera IRL Limited, generated a response fom the Board of the Ollachea Community, who are qualified to respond, according to the Law of Rural Communities of Peru.  Their statement asked for respect and that Mr Pinto abstain from continuing with those same actions.
Despite this, the Board of Minera IRL Limited persisted in its actions and published in its website conveniently edited videos of a meeting with the Community held on November 7.  The meeting lasted for over 2 hours and the edited video only presents 6 minutes.   The end of the video features messages (not from the Community) downgrading the Directors proposed by shareholders for the EGM of November 26 and mentions one of the  shareholders of the Company.
Minera IRL SA laments that the current Board of Minera IRL Limited, due to its lack of knowledge about Communities in Peru, is generating conflict, at the expense of 8 years of good relations developed with the Rural Community of Ollachea, and reiterates that charges of these dealings are before the correct authorities.


UPDATE: Here's UK brokerage SP Angel, who doesn't fall for the Team Hodges BS at all.


11/19/15

Waiting for Goldot Again

A great piece on gold by Gary over at Biiwii tonight. It's unfair to excerpt any of it, the best thing to do is just go read it.

Meanwhile in Ollachea...

...Team Hodges is running dirty tricks on the locals. IKN's guy at ground level in the town of Ollachea brings you the very latest.

The first one was earlier in the week, when Team Hodges decided to publish a video of the near two and a half hour community meeting between Diego Benavides and the people of Ollachea, cut away two hours and twenty three minutes and leave just seven minutes or so of the bits when a couple of locals voiced their opinion against the project. 
  • No matter that such community meetings are always open floor and all opinions are welcomed.
  • No matter that people for and against any given subject are always encouraged to talk.
  • No matter that the meeting was very typical, with a few voices anti and the vast majority pro.
  • No matter that after the very democratic and open house process, the meeting signed a declaration of full support for Team Benavides.

Because those things don't matter to dirty tricksters.

The second one came last night and this morning, when a group of three or four Ollachea locals who've suddenly and strangely decided to support Team Hodges after meeting in private with Jaime Pinto in Lima the week before last (heaven only knows what went in that little tete-a-tete), announced to locals that they were in possession of an audio of a telephone conversation between the community President and one of the people who works in the Team Benavides community team (the team that fostered an eight year old successful relationship between company and community). He said that the audio was all about the community president accepting bribes and cash from the company and due to that, they called an emergency meeting the next day (i.e. this morning) to let locals listen to the evidence.

  • No matter that recording a private phone conversation and then broadcasting it is a very serious crime in Peru
  • No matter that these people have already shown their "editing skills" with the community meeting video, beautifully cut to seven minutes.
  • No matter that the relationship between IRL and the community before Team Hodges showed up was always harmonious and transparent.

But surprise surprise, when the meeting happened this morning, it turns out the person who said they had the recording doesn't have the recording. No audio exists, it was all a bluff. But still they insist on spreading lies and they're now trying to get an alternative "community declaration" signed so that Jaime "Not Hodges!" Pinto can play at "oh look the community is divided" in his news release tomorrow morning. Apparently a piece of paper signed by four people is going to be the same as an eight year relationship between a company and a whole town.

UPDATE: In a town of 700 voters, the usurpers have managed to gather the sum total of 20 signatures today Thursday. They're still going to use this as evidence of a total split though, mark my words. Utter scum.

Something you need to know about Jaime "I'M NOT HODGES!" Pinto, non-executive chair of Minera IRL (IRL.to) (MIRL.L)



Back in late September IKN ran a note entitled "The Talented Mister Pinto" which outlined the story of Jaime Pinto (aka Jaime NOT HODGES! Pinto) of Minera IRL Team Hodges and his deep connection with a U$50m corruption scandal under the Fujimori government in the 1990s. It also noted how in 2003, after a Congressional investigation into corruption, the people running the investigation recommended that Jaime NOT HODGES! Pinto face criminal charges for his role in the affair.


For more check out the full note on Pinto, it's right here on this link. Lotsa fun.

Thing is, today we learn that the case against Jaime Pinto, one which was never dismissed but laid dormant, has been re-opened and he is again under active investigation by the Peruvian authorities. His case is being investigated by the people at the Lima Penal Court that specializes in cases of corruption (precisely in Spanish, the "2da Fiscalía Provincial Penal Especializada en Delitos de Corrupción").

It's also worth noting that unlike the trumped-up and gossamer thin case brought against Diego Benavides by Minera IRL Ltd earlier this week, Diego Benavides is not the person who's brought the charges against Jaime NOT HODGES! Pinto. Nobody from Team Benavides in fact, these are completely separate from the whole IRL affair.

So if you feel like voting for a person who's under a real and high-level corruption investigation, Pinto's yer man. Go ahead, make his day.

UPDATE: To answer a mailer (very quick feedback on this post), no I'm not making this up. That's why I included the exact name of the courthouse in Peru where the investigation is moving forward. I understand the case was re-opened on Tuesday or Monday of this week, which will also help you check if you so desire.


Gold price talk

Here's HSBC today Thursday:

Money managers, who have cut their net length, are “mostly prepared” for a Fed hike, says HSBC. “This may explain gold not falling on the release of the ostensibly bearish minutes,” HSBC says. “It is possible that the gold market has largely factored in a rate rise. This leads us think gold is likely to trade sideways to slightly higher, at least in the near term.”

Here's part of the intro to The IKN Weekly issue 340, last Sunday, while explaining why the price of gold is not going to drop to U$1,000/oz:


Let us be clear:

  • The reason why gold’s been weak is that the dollar’s been strong
  • The dollar got strong because of the US Jobs number
  • The US macro improvement indicates that Janet will raise the base rate in December
  • That move needed to be baked into gold.
  • It’s now baked in.
  • And that’s all.

 Probably just a coincidence.

Ignore it if you like English language bizmedia, but the Samarco (BHP/VALE) tailings disaster story isn't going away

With this piece, "Brazil toxic mudslide devastates local water supply – in pictures", The Guardian manages to break a little of the hermetic seal that the English language media has succeeded in putting on the Samarco iron ore mine (Vale and BHP JV) in Brazil. Here's how the report and photoshow begins:
Iron ore residue from the collapse of a mining dam, part-owned by BHP Billiton, has been passing down the Rio Doce in south-east Brazil. Pollutants have killed aquatic life and left residents of the towns of Resplendor and Baixo Guandu without clean water

Go see it all here

Atna Resources (ATN.to) and IKN

This humble corner of cyberspace has had several things to say about Atna Resources (ATN.to) over the years and, as you might guess, none of them were very positive. The last time we covered the stock was on August 4th in this post entitled "Atna Resources (ATN.to): A rant". There were a bunch of charts to explain the woeful state of its financial affairs (go have a look, they're fun (!)) but to give an idea of the whole thing, here's how the piece ended:
Amazingly, there are still idiots who in 2015 have been recommending this company's shares to people, saying that it's cheap and stuff. With that in mind I'm going to put the next bit in bold type, just to make sure it catches your eye at the late stage of a long-ish post:

You may think 7.5c, or even ATN's recent 10c or 11c level, is a cheap price for a share price of a producing and operating gold mining company. Believe me, it's about to get a lot, lot cheaper because once Waterton's done with ATN this equity is going to be smashed into tiny little pieces.

Do yourself a favour, ladies and gentlemen of the retail investment community, make note of the names of the people who've been pumping this utter junk at you and remember never to listen to anything they have to say about investment ever again. "Stop The Stupid" applies to your own trades, it also means that these blithering idiots need to be weeded out of the mine chattering class as soon as humanly possible.

Atna Resources Ltd. Announces Filing Of Voluntary Petition For Relief Under Chapter 11 Of The Bankruptcy Code To Implement Restructuring And Delay In Q3 Filings
And later in the NR...
"The Company and Waterton Precious Metals Fund II Cayman, L.P., Atna's pre-petition lender under a secured facility, have negotiated a consensual use of the Company's cash and have entered into a debtor-in-possession financing arrangement (continues here)"

ATN is under trading halt due to today's news. Any further questions?

11/18/15

Annals of stupid Investor Relations ideas, Rubicon Minerals (RMX.to) (RBY) edition

Imagine if you will that you own a whole bunch of Rubicon Minerals (RMX.to) (RBY) stock (luckily I don't because I'd never buy a stock Louis Lobito Little Wolf James calls his "Best Buy of 2015").



Indeed kind reader, that's what RMX has done in 2015 thanks to a complete disaster commissioning phase and its now well-documented problems which caused it to stop mining because they never bothered to check the geology before mining the deposit. And they didn't want to tell anyone. Until it was too late. Nice people.

And now imagine that after getting anally penetrated in such a way as a shareholder, you receive this in the post from RMX:



Yup, that's what Allan Candelario, IR person at Rubicon Minerals, sent from his office today to his mailing list of anal ysts and shareholders. In so many words, the company that crashed and burned 90% of its backers' cash now wants those very same to stump up and buy some of their gold. For Christmas! Because Santa Claus, because eggnog, because Rudolph and because mistletoe.

Allan, you are a very very stupid person. Merry Christmas.

Jaime Pinto's reading material



 The scene from today's Standing Room Only press conference.

Here's the best bit from today's presser held by Jaime Pinto and his happy band. When asked by one of the reporters about the salaries being earned, Jaime Pinto mentioned that he wasn't being paid anything except for a small retainer, plus has no type of success bonus set up. But let's leave aside the strange thoughts of just why he's working "25 hours a day" (his words during the presser, not mine) for virtually zero pay and move to the answer to the follow-up question that came from another of the reporters there.

Pinto (finishing his point): "...I'm not paid anything."
Reporter: "Neither is Mr. Hodges?"
Pinto: I'm not Hodges! If he made mistakes he will assume his mistakes. Yes I know him but what I want to say is...(pause) ...I...(pause)...there's these blogs..."Team Hodges", I have nothing to do with Hodges. I'm not Hodges, I am Peruvian, a respected Peruvian lawyer. I have nothing to do with Hodges."

Jaime, we love you. And we have the recording of the presser to prove how much we love you.

This Kirkland Lake (KGI.to) St. Andrews (SAS.to) deal again

This KGI buyout of SAS deal got a mention on the blog yesterday but it's kept floating back into my brain all morning, because the more I think about it the more it shows its place as a real tell on the awful state of the market. Here are a few simple numbers to illustrate.

As at the November 16th close (before deal announced):
  • KGI had 80.6m shares out priced at $5.23, therefore a market cap of $421.54m
  • SAS had 368.27m shares out priced at $0.38, therefore a market cap of $139.9m
  • Therefore total market cap: $561.44
According to the deal NR, the Pro Forma of the merged KGI + SAS is that the newco will have 117.6m shares out. As KGI close at $4.63 yesterday, that made the pro forma market cap $544.5m

Can somebody tell me why KGI is paying a 25% premium to SAS's closing price? Or where that $17m just disappeared to, for that matter?



What if you held a press conference and nobody came?

Here's Jaime Pinto and friends, holding a press conference in Lima this morning.



They're running down the company's eight point plan, recently released, that explains the company wants to turn its back on an agreed U$240m financing deal in a difficult market and dilute the company's share count to merry hell. And the reason? "Because".

These people are crazy! They want you to agree to refuse a cheque to fully fund your mine! In this market!

But what you can't see in this is that he's speaking to just four people. Well, five if you include the photographer.

Not going well, is it Jaime?

UPDATE: My fave Q&A so far:
Q: "Why haven't you travelled to the Ollachea project?"
A: "For safety reasons."

Just wonderful, Jaime. Pure comedy gold.

PS: To be fair, by the end of the one hour and twenty minute presser there were a total of 15 people in the room. The five sat at the desk, the contracted photographer, the presser organizer, and eight in the audience. El Comercio's journalist was there, but Peru's biz news media of choice Gestión didn't bother to go. Neither did AP, EFE, not sure about Bloomie (edit update: Quigley of Bloomie was there). But what's really telling is that the Reuters hack didn't show, even though the Reuters office in Lima is literally across the road from the hotel where they held the bash. Reuters had better things to do, apparently.

The latest Minera IRL SA (Team Benavides) news release

Gotta love this one. Team Benavides returns the criminal charge stupidities to Team Hodges, with interest.


xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx



Regarding the request for a criminal investigation by Minera IRL Limited

Lima, 18 November 2015: In response to the news release from Minera IRL Ltd dated today, November 17th 2015, Minera IRL S.A. states the following:


The Board of Directors of Minera IRL Ltd today announced that it has filed a request for a criminal investigation against Diego Benavides and others in relation to the US$70m bridge credit agreement with COFIDE
 
- The Public Ministry of Peru (El Ministerio Publico del Perú), the authority charged with receiving and formalizing charges in order to determine if there has been a crime committed, has begun the process of evaluation of the alleged criminal charges.

-          The announcement of the Board of Directors shows its interest in unduly influencing shareholder opinion with just nine days to go before the Extraordinary General Meeting (EGM), to be held on November 26th 2015. 

-          Regarding the events described in the alleged charges, the recent actions by Mr Jaime Pinto, non-executive chairman of Minera IRL Ltd, are designed to create division and unrest in the Community of Ollachea and to discredit COFIDE. 

-          Why is there such interest to create divisions in the Community of Ollachea or to discredit COFIDE? These are questions that shareholders should ask the current Board of Directors.

Regarding the Bridge Loan from COFIDE, we state the following:

-          COFIDE is the State Development Bank of Peru, has assets of over US$3.5Bn and has participated in the financing of many public sector and private sector projects. Examples include US$715m to electricity generating projects and the North Peru Gas Pipeline, US$445m for road and transport projects, US$115m to mining and agricultural projects, US$97m to water and shipping port projects, among others.

-          COFIDE is the only public institution in Peru that has been recognized for three consecutive years by the Lima Stock Exchange (Bolsa de Valores de Lima (BVL)) for its excellence in corporate governance.

-          The agreement between Minera IRL SA and COFIDE was signed on June 5th 2015 after due diligence of 14 months, in which Goldman Sachs participated.  Sherpa was also subject to extensive due diligence by COFIDE and by Goldman Sachs before the deal was approved.
-          Minera IRL SA contracted Sherpa due to the extensive experience of Jose Cabia, a well recognized, long standing member of the Peruvian financial community and member of the Lima Stock Exchange (BVL).
-          Sherpa is a legally constituted Company that acted as financial advisor consulting to Minera IRL SA, the Peruvian subsidiary.  Sherpa was not contracted to the parent company, Minera IRL Ltd, as COFIDE does not fund foreign companies.  Sherpa’s services were required in order to set up the bridge loan between Minera IRL SA and COFIDE in order to finance the Ollachea Project.
-          All parties, including Minera IRL Ltd under Daryl Hodges and Goldman Sachs, were satisfied that the fee for the structuring agent was fair given market conditions. 
-          The finance agreement was approved by the Board of Directors of Minera IRL Ltd and signed off by Mr. Daryl Hodges, ex-Executive President of the company, who despite not having participated actively in the process and only having been named Executive President in March 2015, awarded himself a bonus commission of up to US$250,000 for the conclusion of the final US$240m credit agreement.

-          With the US$70m Bridge Loan Agreement, Minera IRL Ltd avoided bankruptcy as it allowed the Company to pay its US$30m debt with Macquarie Bank due on June 30th 2015.
-        The bridge loan funds were also used to pay the US$12m owed to Rio Tinto, the main shareholder of the company.

The financing deal was fully approved at the time.  It is only now, with one week to go before an EGM in which the current Board of Directors fear for their positions, that the Board raises objections to the deal it had previously approved.  

For further information please go to:  www.minerairlshareholders.com



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