JOHN L. SMITH: All that glitters is not diamonds or, some investors say, good writing
I'm a bum, a loser, a hopeless sap, the son of a coyote, and worse.
The Scarecrow is more intellectually gifted. The wind has a better way with words. My journalistic skills are so poor it's a wonder any newspaper printed in the English language has had the bad judgment of hiring me.
No, that's not an excerpt from my last employee evaluation. It's the opinion of a group of folks who, to put it delicately, are upset with me for Tuesday's column raising questions about the business practices of the publicly traded CMKM Diamonds.
The Securities and Exchange Commission recently subpoenaed records from a local bank, where CMKM held nearly 100 accounts; and questions have been raised by Canadian securities officials about the style and substance of the company's activities.
CMKM touts itself as a ground-breaking diamond mining and exploration company that's out to extract a fortune from deep beneath the soil of Saskatchewan, Canada. The region has gained a worldwide reputation as a source of diamonds, and major companies are sinking millions into developing their claims.
I was surprised to find that one of CMKM's offices is in Las Vegas, even more surprised to learn that the company is being scrutinized by skeptical investors, reporters and, now, government securities officials for its mammoth stock sales.
I cited a reported estimate of the company's circulated stock as being up to a whopping 500 billion shares, but it appears I was too conservative. According to several investors, the figure is closer to 800 billion shares with what can safely be described as an infinitesimal value.
The creation of so many shares might lead some cynics to wonder whether the company was diluting its stock base. After all, that's almost enough stock to paper Saskatchewan. But there I go again getting smart-alecky.
I should have realized a lot of people are banking on CMKM's success. And they didn't appreciate my wisecrack about using some of the profits from those diamonds to hire a good lawyer.
Good lawyer, indeed. As a matter of fact, the company has retained the formidable services of securities attorney Roger Glenn.
You'd think that would put those investors in a good mood, but you'd be wrong. They're mad as red-hot hornets at me for questioning their business acumen.
(You would also think they wouldn't be so sensitive to the buzzing of a journalistic gnat around the entrepreneurial elephant that is CMKM.)
It might be easier for a numbskull of my marginal abilities to learn more about this company if it had been making the proper securities filings. But paperwork is so passe.
From the flow of the e-mail, it appears I'm not alone in my skepticism; and there are two CMKM investment camps. One I've described. The other consists of shareholders who are getting the sneaking suspicion that they have waved goodbye to their investments.
They admit they were impressed by the company's confident press releases, of which there appear to be many dozens announcing its latest step on the road to possibly the greatest diamond discovery in North American history.
While the Forte a la Corne region of Saskatchewan is indeed a center of diamond exploration, the question remains whether CMKM can deliver the goods.
Those who believe in the wonder of the company have no doubt about its virtues. They're certain CMKM is righteous, but wonder aloud whether it's a victim in this controversy.
It's a victim of complex conspiracies perpetrated by the federal government and its competition in the lucrative Saskatchewan diamond mining business. One writer even said that it's quite possible I am a dupe of the conspirators -- maybe even a co-conspirator.
Yeah, I joined this conspiracy right after I left the grassy knoll in Dallas.
A favorite contact came from a shareholder who wondered whether I was simply a disgruntled investor.
With that, I have a confession to make: I haven't purchased a single share of CMKM stock, or the stock of a competitor.
Which only provides further proof to some people that I'm a bum, a loser, a hopeless sap, and so forth.
John L. Smith's column appears Tuesday, Wednesday, Friday and Sunday. E-mail him at Smith@reviewjournal.com or call 383-0295.
reviewjournal.com |
