How to bury material information if you’re a junior miner

  1. Bury it in the middle of a press release about something else.
  2. Reveal material information in a quarterly (not annual) MD&A, because most people don’t read ’em.
  3. Simply choose not to release it.  This is probably illegal and may be considered illegal if lawyers sue company insiders.  However, some juniors have directors’ & officers’ insurance that may protect insiders against some of these claims.  NI 43-101 has reduced some of these abuses as companies now have to reveal more technical data about its properties.  The technical reports often contain information about metallurgical problems with a deposit; few companies will mention these metallurgical problems elsewhere so it can be worth reading the technical reports for yourself.  Title issues are often not revealed at all; there is no legal equivalent of a NI 43-101 report.
  4. Announce delays to releasing the information (e.g. lame excuses for why a feasibility study isn’t ready or why the scope has changed) until everybody hopefully forgets about it.  Also, make sure that negative information is released after a private placement.  Private placement investors are supposed to be sophisticated so in a courtroom you can argue that it’s their fault that they didn’t do their due diligence.
  5. Instead of announcing that your deposit is worthless in a material change report or press release, just quietly write the property down to 0 in your quarterly or annual filing.

If you blow up enough shareholder capital, eventually they won’t have anymore capital to give you.  So learn from all those part-time CEOs on the TSX Venture Exchange.  If one of their promotions blow up, they still have a few others that will pay them six-figure salaries.  It’s not like shareholders degenerate gamblers are smart enough to figure out that every unnecessary company comes with six figures worth of unnecessary listing fees, transfer agent fees, legal fees, audit fees, and directors’ salaries.  The part-time CEOs understand that they are in the business of mining… the stock markets.

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One thought on “How to bury material information if you’re a junior miner

  1. Pingback: Mine economics explained | Glenn Chan's Random Notes on Investing

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