Mining directors fined, banned from securities trading
Two directors for a mining company claiming reserves the BC Securities Commission says it didn’t have are to be fined and banned from trading in securities.
The penalties resulted from claims made on behalf of Brookmount Explorations Inc., a company that was being traded on the Over the Counter Bulletin Board.
A BCSC disciplinary panel found company directors Peter John Flueck and Zafer Erick Sungur made “misrepresentations” in news releases in February 2005 and June 2007.
“The news releases falsely stated the value of Brookmount's principal mining property by claiming that it had mineral reserves when in fact it had none, contrary to both geological reports Brookmount had received, and what Brookmount had reported in its filings with the U.S. Securities and Exchange Commission,” the BCSC said in a news release.
The statements constituted a breach of national standards for mining disclosure, the BCSC said.
Sungur received a $45,000 fine and has been banned from trading in the securities of any issuer with whom he is in a special relationship, and from acting as a director or officer of any issuer.
He is also not to promote or engage in investor relations activities, or provide management or consultation services in connection with any securities.
Flueck was ordered to pay a $65,000 fine and received a similar ban on securities trading. The one exception is that he can act as a director of Brookmount until May 29, 2013, but only in order to sell or wind down the company.
A BCSC panel has issued a cease-trade order relating to Brookmount.