Thursday, October 16, 2014   

Gold claims alleged to have defrauded investors

The former owner of the Edmonton Oilers has been accused of securities fraud in relation to a gold mine in La Paz County.

Peter Pocklington, who famously ‘sold’ Wayne Gretzky to Los Angeles, is alleged to have misrepresented the amount of recoverable gold in the mine while raising more than $4.8 million from at least 116 investors between July 2010 and September 2011.

In 2009, Pocklington, living in California, started a company called Crystal Pistol Resources with offices in Scottsdale. He wanted to “acquire, own and operate” surface gold mines, known as ‘placer’ mines.

Documents filed with the Arizona Corporation Commission earlier this month say that Pocklington’s website contained videos of a geologist discussing finding gold at all of the locations involved, and suggested that “an initial investment of $10,000 at $1 per unit would pay a return between $25,000 and $40,000 per year” to investors.

In May last year, Pocklington is asserted to have filed a notice with BLM that allows for “surface disturbance of five acres or less to remove up to one thousand tons of presumed ore” for testing purposes only. But Pocklington’s Vice-President of Operations John McNeill is alleged to have told at least one Arizona investor that the company “was processing a thousand tons per month and within a week of their meeting would have cash flow of about $300,000 to $400,000 a week.”

Pocklington and McNeill would sometimes bring interested parties to the mine site in La Paz County.

The documents go on to say that “the analyses related to the quantity of gold held by the CPR mining claims … are flawed” and that they over estimate “the quantity of recoverable gold based upon the flawed analysis.” And, “Further, the estimates of gold resources listed on [Pocklington's] website are not supportable with the methods currently available in the industry.”

The mining claims involved are unrelated to the large Copperstone Mine north of Quartzsite, which also has Canadian ties. Bonanza, a Canadian company (under its U.S. name American Bonanza), recently started operations at Copperstone and last month reported that they had shipped their first 31 tons of concentrate, containing an estimated 712 ounces of gold (worth over $1.1 million at today’s price). The company aims to reach a production rate of around 3000 ounces per month.

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