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2/15/18

Gold Resource Corp (GORO) on its U$0.5m fine

I love this, a mail sent by Greg Patterson of Gold Resource Corp (GORO) to a shareholder of the company (who will remain nameless, as will the go-between who forwarded the mail) asking for an opinion on the IKN post of a couple of days ago that pointed out GORO has been fined half a million dollars by the government of Mexico for operating without licences.

The argument of GORO seems to be:
  • IKN is an anonymous blogger, therefore we can ignore any proven fact that is stated against the company. Because.... internet!
  • IKN mixes fact and fiction, without of course mentioning any of the imaginary fictions (hint: there are none)
  • GORO prefers to ignore the legally required permitting requirements of any mining company but "voluntarily pursue" other programs at its ops, which doesn't just make it good, but actually better than any company that's operating legally.
  • GORO is a good corporate citizen which refuses to pay its fines.
  • Oh, IKN is written anonymously and mixes fact and fiction...did we mention that before?

Sadly, the facts are 100% different to the BS GORO is trying to foist on the unwary. This is a company IKN called out for years for being extremely overvalued (as it dropped from over U$20/share to its current $4 and $5 range), for over-promising on production and expansion and never fulfilling its promises (e.g. in early 2012 it was still promising 200k+ oz AuEq production...all quietly dropped), for maintaining a crazy and unsustainable dividend policy (which eventually cracked and disappeared), the large scale insider selling as GORO shares dropped that wasn't disclosed until much later, plus of course the deaths at the mine that happened while the company had no operating or enviro permit. No fiction in that list, you two-facedpieces of corporate crud, all those are facts.

Anyway, read Greg Patterson's reply to the IKN post.

From: Greg Patterson
Sent: Tuesday, February 13, 2018, 10:37:43 AM PST
Subject: RE: Arista Fine

XXXX,

IKN (he does not write under his real name) has been a critic of the Company for years.  We believe his statements mix fact and fiction for a salacious story.

What I can tell you is the Company continues to voluntarily pursue the Mexico Clean Industry Program at its operations, and therefore puts itself under additional environmental scrutiny in that regard.  The Company has in its possession the LAU permit.  The Company disagrees with the fine (and is being advised by counsel to fight it).  Regardless, we will still be working towards our Clean Industry Program status, again on a voluntary and very transparent basis with the authorities.

The unfortunate fatalities and this fine have nothing to do with each other.

IKN is known for producing salacious stories that twist facts with fiction.  Perhaps that is why he chooses to write under an anonymous blog?  As I mentioned he has criticized the Company for years and we continually prove him false as we reached production, have had 6 consecutive years of profitability and organic growth, have returned $110M in shareholder dividends and have been awarded Mexico’s ESR seal for three consecutive years which demonstrates the Company is a socially, cultural, environmental and economic positive impact company.  None of these things will ever make it into an IKN criticism.