Mineral Companies - Background...
Subject 54392
To invest in a development stage mineral company, or "Juniors" as they're known in Canada, you MUST be able to trust management.
Why? Because the value of a development stage mineral company is simply put, minerals that company's management claims are in a chunk of property.
1. You must be able to trust that management actually has rights to the subject property; and,
2. That the study done to establish the minerals was accurate, not fraud; and,
3. That the study was properly engineered to determine the size of the mineral deposit, and the minerals can be extracted and brought to market economically.
I have found that fraud in development stage mineral companies is rampant. In my experience, over many, many years of investing, more than 9 out of 10 development stage mineral companies were frauds or failures.
All involved significant promotion, often the minerals were located in distant exotic lands... Management always claimed the size of the deposit was mind boggling. In my experience, most were clear fraud and management was responsible a majority of the time.
Fraudulent studies are common place; honest mistakes occur regularly; minerals are often not found where they should be. Perhaps oil is found, but it's not possible to extract economically, without for example a pipeline that can't be built due to feuding warlords. The stories are endless, but a common thread prevails...
In development stage mineral companies, you must be able to trust management's claims when they say "we have a property, it has these minerals, and we can extract them economically".
Can we trust IVAN management when they make claims about IVAN's minerals properties? Does IVAN's management tell the truth? Do they exaggerate the truth? Do they try to make a worthless property look valuable so they can sell stock and raise money?
I have a number a historic and current HARD facts that suggest IVAN Management do not tell the truth about mining properties. |
