Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : International Precious Metals (IPMCF) -- Ignore unavailable to you. Want to Upgrade?

To: d:oug who wrote (32465)	5/30/1998 9:32:00 PM
From: d:oug	Read Replies (3) \| Respond to of 35569

This is a cut down version the article I mentioned. Could I get into legal problems from making this type of copy and distributing it ????? Business Week: June 8, 1998 Finance: INVESTIGATIONS STOCK REGULATORS: WHAT HAPPENED TO CANADA'S RED FLAGS? Despite Bre-X, Canada let another lulu get by For four years, YBM Magnex International Inc. was a darling on the Canadian stock markets. The small Pennsylvania-based magnet maker grew from a shell company that traded for pennies on the wild and woolly Alberta Stock Exchange to a global industrial player whose stock climbed to nearly $14 a share last March, hiking its market value above $600 million. It was boosted by analysts from some of Canada's toniest brokerage The bubble burst on May 13, when the U.S. Customs Service, Federal Bureau of Investigation, Internal Revenue Service, and Immigration & Naturalization Service raided the company's Philadelphia-area headquarters. A spokeswoman for the Royal Canadian Mounted Police says the raid was part of a two-year criminal investigation. Trading in YBM has been suspended on the Toronto Stock Exchange. The company, whose What's most remarkable about the YBM saga is the veritable forest of red flags that were ignored by Canadian securities regulators, brokerage executives, and investors: statements (table). Regulators, who knew of YBM's dubious origins, cleared it for trading first in Alberta and then on the prestigious Toronto exchange. And investors, especially many of Canada's major-league mutual funds, helped YBM through a $34 million public offering last fall. ''As a Canadian investor, I find it embarrassing,'' says Stephen however, was banned from entering Britain. Nonetheless, officials of the Alberta Stock Exchange permitted trading to resume, explaining that they couldn't bar it without proved wrongdoing. Despite its questionable origins, Pratecs changed its name to YBM and was able to rebuild its reputation with the help of some of Canada's most distinguished brokerage firms. In late 1995, First Marathon Securities Ltd., Canada's largest independent investment house, and Griffiths McBurney & Partners, seemingly entranced by the company's promising ventures in the fast-growing former communist countries, helped YBM through a $9.4 million underwriting. A spokesman for First Marathon says due-diligence reviews on YBM were ''comprehensive'' and took note of the British investigations but cleared the firm for investment anyway. Says First Marathon's To some critics, the YBM saga dramatizes the shortcomings of the fragmented regulation in Canadian securities markets. ''Maybe we need to upgrade the whole practice in Canada and harmonize it with similar practices in the U.S.,'' says G. Andrew Karolyi, a professor of finance at the University of Western Ontario. Coming on the heels of last year's multibillion-dollar Bre-X Minerals Ltd. gold-mining scandal, Canada's stock markets can't afford yet another humiliating black eye. By Joseph Weber in Toronto Copyright 1998 The McGraw-Hill Companies, Inc. All rights reserved. Any use is subject to (1) terms and conditions of this service and (2) rules stated under ''Read This First'' in the ''About Business Week'' area. Oops, I forgot to read the above "Read This First" I'll do that now.