A distant relative named Brendan Caldwell says that there have been laws against fraud for hundreds of years and piling on more checks and balances isn’t going to stop someone from making up something that isn’t true. He is right about the details, but in the bigger picture he is totally wrong. Let me explain.
Archive for August, 2007
Rio Tinto presumably did not keep good track of their claim records. Seem they forgot that they had to renew a claim to the Shovelanna iron ore tenement deep in Western Australia. You can imagine the panic as somebody at the last minute realized a document had to be in an important place. They prepared the document and did what we all do: give it to a courier to deliver. The courier tarried along the way and delivered the documents late.
Sitting in the wings hoping to benefit by the tardiness of the courier was a gentleman by the name of Cazaly. Seems he noticed this tardy courier and jumped in and staked the claim ahead of Rio Tinto. By law he now held the valuable claim. He quickly trotted off to BHP Billiton which promised to help him develop a mine.
The most common response to the question: “Has the NI43-101 process failed us in the Southwestern Resources case?” is a stout and firm reply: “If somebody wants to crook the books, there is nothing honest people can do about it.” To which I must reply: twaddle.
Of course there are crooks and fools in all walks of life; but that does not mean that we should neglect to put the systems in place that may be needed to catch them. Now is not the time to defend MSHA, the NI 43-101 process, or President Kabila. Now, as always, is the time to ask what we need to do to continuously improve the process/system to stop more crooks making fools of us all over again.
To emphasize my point and take a slightly lighter look at things, here is my collation of the doings of the crooks and fools in the mining industry this week.
The news is all over the web that Southwestern Resources is suing its ex-CEO, John Patterson, for fraud, breach of fiduciary duty, and insider trading. Here is some of the spicey language being used by David Black, current chair of Southwestern Resources, to describe Mr. Patterson’s behavior: