Augusta Resource’s top officers have history of bankruptcies, cease trade orders and stock exchange delistings

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Augusta Resource Corporation Chairman Richard Warke and board member Donald B. Clark have been business partners for more than two decades.

Warke, a venture stock promoter, and Clark, a banker, have served on the board of directors of several Vancouver, B.C.-based public companies.

From their offices in the Terminal City Tower overlooking downtown Vancouver’s waterfront, Warke and Clark now manage several speculative mining companies including Augusta Resource Corporation, Wildcat Silver Corporation and Riva Gold Corporation.

Augusta owns the Rosemont Copper Company, which is seeking permits to build an open pit copper mine in the Santa Rita Mountains south of Tucson. Wildcat Silver is seeking government permits to construct a silver mine near Patagonia, Ariz. Riva Gold has mining claims in Guyana.

Richard Warke

Their business partnership began in 1991, when both men served on the board of First Western Metals. First Western ran into financial difficulties and was issued cease trade orders by Canadian securities regulators in 1991 and 1992. First Western later changed its name to Augusta Metals Corp. before acquiring Cybercom, Inc.

Warke and Clark were on the Cybercom board when Canadian regulators issued the education software company a cease trade order in 2002 for failing to file annual financial statements. The CTO was never lifted.

Warke and Clark also served on the board of directors of West Coast Plywood Company and were corporate officers when the company filed for bankruptcy in July 1995.

Wark and Clark, along with four other current and former board members of Augusta Resource, served on the board of Sargold Resource Corporation. Sargold operated an open-pit gold mine in Sardinia. See related story and documentary.

Clark also has an extensive background on the board of directors of several U.S. corporations, most notably, Pasadena, Calif.-based Conversion Industries, Inc.

Clark resigned from the Conversion board of directors in October 1994, 12 days after the American Stock Exchange announced its intention to delist Conversion for alleged trading irregularities.

Donald Clark

Conversion reached a settlement agreement with the U.S. Securities and Exchange Commission in March 1995 and agreed to be delisted from the AMEX. Conversion filed bankruptcy in May 1995.

Warke’s business history includes a 1989 insider trading settlement agreement with a British Columbia Securities Commission and a personal bankruptcy proposal filed in September 1998 and satisfied in November 2002.

Warke is listed on the British Columbia Securities Commission website under the commission’s “Disciplined Persons and Investment Caution” section.

The corporate and personal bankruptcies, stock exchange delistings and cease trade orders described above were not disclosed in some subsequent filings by public companies that included Warke and Clark as directors. Among these companies is Augusta Resource.

Warke’s personal bankruptcy was frequently omitted from corporate disclosures that require personal bankruptcies to be reported for 10 years. Augusta Resource, for example, did not disclose Warke’s bankruptcy filing even as the case was ongoing between Sept. 15, 1998 and Nov. 22, 2002.

Augusta Resource did not disclose Warke’s bankruptcy until April 6, 2006, regulatory filings indicate. Augusta Resource continued to disclose Warke’s bankruptcy in 2007 and 2008.

The company, as well as other public companies that include Warke and Clark on the board of directors, have not disclosed the bankruptcy since October 2008, except on one occasion.

Ventana Gold Corporation disclosed the bankruptcy on Oct. 31, 2008, which is more than 10 years after Warke filed the petition on Sept. 15, 1998.

The company stated: “The Trustee acting in the Proposal certified the Proposal as fully performed on November 21, 2002 and he was thereby discharged.”

British Columbia Securities Commission Deputy Director of Finance Andrew Richardson stated in a Dec. 15, 2010 telephone interview that personal bankruptcy proceedings must be reported on corporate disclosures for 10 years from the date of filing the initial case and continuing through the date the bankruptcy is concluded. If a case takes four years to conclude, the effective disclosure period is 14 years, he said.

In early September, BCSC spokesman Richard Gilhooley stated in an email that the 10-year disclosure period is not tied to the conclusion date of a bankruptcy. Gilhooley said there are certain events, however, that can trigger the initiation of the 10-year disclosure period beyond the initial filing date of the bankruptcy.

Gilhooley said the Commission does not have a “definitive answer” of whether Warke’s October 2002 bankruptcy default is a triggering event that requires disclosure of the bankruptcy for 10 years from the default date.

InvestigativeMEDIA has included all known examples of companies failing to disclose Warke’s bankruptcy from 2000 through 2012 in a written and video timeline of the business history of Augusta Resource’s longtime business partners. [Read more…]

Former Rosemont Mine investor poised to gross $400 million on Arizona Mining Inc. sale

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(Reprinted with permission from Rosemontminetruth.com)

Richard Warke, the former top executive of Augusta Resource Corp. which sold the proposed Rosemont copper project to Hudbay Minerals in 2014, stands to gross US$409 million in connection with the sale of another company with a proposed mining project in southeastern Arizona.

Richard Warke

Australia-based South32 has offered US$1.3 billion cash to purchase Arizona Mining Inc.’s Hermosa mine project six miles south of Patagonia. The Hermosa Project comprises the zinc-lead-silver Taylor deposit and the zinc-manganese-silver Central deposit.

South32 is Australia’s third largest mining company and already held a 17 percent share in Arizona Mining prior to making the June 15 offer. Arizona Mining’s board of directors unanimously recommended shareholders approve the sale. Warke is Arizona Mining’s executive chairman.

South32’s offer of C$6.20 a share was about 50 percent higher than Arizona Mining’s June 15 closing price on the Toronto Stock Exchange. South32’s shareholders’ approval is not required and the deal is expected to close in September, according at a joint press release issued by the two companies.

Warke controls 88 million shares of Arizona Mining according to the company’s most recent Management Information Circular filed with Canadian securities regulators. The huge windfall comes 20 years after Warke filed for personal bankruptcy in Vancouver, British Colombia during a period in which he was engulfed in financial problems including a corporate bankruptcy and several cease trade orders issued by Canadian regulators.

Warke failed to disclose the personal and corporate bankruptcies and cease trade orders in subsequent regulatory filings spanning nearly a decade, according to a complaint filed by Save the Scenic Santa Ritas, a Tucson-based conservation group, with the British Columbia Securities Commission (BCSC) and the U.S. Securities and Exchange Commission .

Warke’s personal bankruptcy filing came 9 years after he signed a settlement agreement with the BCSC on an insider trading violation. As a result of the settlement agreement, Warke remains on the BCSC website under the warning “Disciplined Persons and Investment Caution.[Read more…]

InvestigativeMEDIA, MiningWatch ask U.S. and Canadian ambassadors to intervene with Peru over detentions

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RIMROCK, AZ–InvestigativeMEDIA and MiningWatch, Canada, today sent a joint letter to the U.S. and Canadian ambassadors to Peru asking them to seek information from Peruvian officials about last April’s detention of John Dougherty and Jen Moore in Cusco, Peru.

Mr. Dougherty is the owner and editor of InvestigativeMEDIA and Ms. Moore is the Latin American Coordinator for Ottawa-based MiningWatch, Canada.

Peruvian National Police and immigration authorities detained Mr. Dougherty and Ms. Moore on the street after the screening of InvestigativeMEDIA’s documentary “Flin Flon Flim Flam” at Cusco’s Municipal Cultural Center on Friday, April 21. The film had been dubbed into Spanish and Quechua.

The film documents Toronto-based Hudbay Minerals’ worldwide operations and highlights its deployment of the Peruvian National Police to beat and teargas protesters near its Constancia open-pit copper mine near Uchucarco, Peru in November 2014.

Hudbay confirmed in May that it continues to have a contract with the Peruvian National Police to provide security services.

Mr. Dougherty and Ms. Moore were taken to police headquarters and held for more than four hours and pressured to sign statements. Mr. Dougherty refused to sign any documents without an English-speaking attorney present. There was no warrant issued for their arrest.

The next day, the Peruvian Interior Ministry issued an inflammatory press release (English translation) accusing Mr. Dougherty and Ms. Moore of inciting civil disturbance that is punishable by expulsion from Peru for up to 15 years. The press release noted that Hudbay has all permits to operate in Peru.

Prior to their arrival in Peru, anonymous articles published in a Cuscso newspaper alleged that Mr. Dougherty and Ms. Moore were preparing “to ambush” Hudbay. Subsequent articles accused the two of inciting violence after several Hudbay copper concentrate transport trucks caught on fire.

“We believe the stigmatization in the press and by a public authority, along with the police harassment, illegal and arbitrary detention and our ongoing legal prosecution is a result of the privatization of the public security apparatus in Peru and about state authorities and Hudbay Minerals trying to exert control over what information communities living around the company’s Constancia mine have access to,” the joint letter to the ambassadors states.

The letter requests the ambassadors to ask the following questions to Peruvian Ministry of Foreign Affairs and the Ministry of Justice and Human Rights:

  • Why were Mr. Dougherty and Ms. Moore subjected to this sort of surveillance, harassment and criminalization?
  • Why were police tracking their movements from April 18 to 20?
  • Why did the police fail to duly notify Mr. Dougherty and Ms. Moore and allow them the appropriate time to respond to any concerns about their migratory status, if that was indeed the concern, and instead illegally and arbitrarily detain them for four hours on April 21?
  • On what basis did the Interior Ministry publicly accuse Mr. Dougherty and Ms. Moore, on April 22, of having incited local campesino populations to violence and demonize them as a threat to public order, internal order and even national security.

Mr. Dougherty and Ms. Moore left Peru prior to a hearing that was scheduled for Monday, April 24. Both are currently represented by separate legal counsel. Police released an April 22 initial report that documented the screening of the film in several communities near Hudbay’s  Constancia open-pit copper mine. No other evidence has been released as of June 20.

Hudbay Minerals is currently seeking a federal Clean Water Act permit from the U.S. Army Corps of Engineers for its proposed $1.9 billion Rosemont open-pit copper mine planned for the Santa Rita Mountains on the Coronado National Forest southeast of Tucson, Ariz.

Canada’s National Observer reports on Peru detention of Dougherty and Moore

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Canada’s National Observer published an excellent story Friday, May 12, about InvestigativeMEDIA’s owner John Dougherty’s recent detention in Peru along with Mining Watch, Canada’s Jen Moore. Here’s the link: http://www.nationalobserver.com/2017/05/12/news/detained-and-accused-peru-canadian-activist-suspects-foul-play

CFAX radio in Victoria, Canada interviews Dougherty, Moore on Peru detention

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Mark Brennae of CFAX radio in Victoria, Canada interviewed InvestigativeMEDIA’s John Dougherty and Jen Moore, Latin America program coordinator for Ottawa-based MiningWatch, Canada on Wednesday, May 10 about their April 21 detention by the Peruvian National Police and Peruvian immigration authorities after a Cusco, Peru screening of Dougherty’s documentary “Flin Flon Flim Flam” on the worldwide operations of Hudbay Minerals.

The 30-minute interview can be heard here:

http://www.iheartradio.ca/cfax-1070/shows/the-drive-with-mark-brennae-1.1821472

Peruvian police detain filmmaker after showing documentary critical of Hudbay Minerals

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(Phoenix, Ariz) The Peruvian National Police and immigration authorities detained InvestigativeMedia owner and filmmaker John Dougherty on April 21 after he finished screening his documentary film “Flin Flon Flim Flam” in Cusco, Peru.

 

The documentary reports on Toronto-based Hudbay Minerals’ worldwide mining operations.

More than a dozen plain-clothes officers surrounded Mr. Dougherty and Jen Moore, Latin American program coordinator for MiningWatch, Canada, on the street outside the Cusco Cultural Center and forced them into a vehicle without a warrant. They were taken to the immigration office in Cusco. In a statement released early Monday, Mining Watch, Canada detailed Mr. Dougherty and Ms. Moore’s unlawful apprehension.

Police held Mr. Dougherty and Ms. Moore for four hours before being released early Saturday morning. Mr. Dougherty refused to sign documents or declarations police were pressuring him to sign without the presence of English-speaking legal counsel.

Peru National Police officer Edgar Abarca Lezama holding documents during detention proceedings Cucso, Peru against John Dougherty and Jen Moore.

Peru National Police officer Edgar Abarca Lezama holding documents during detention proceedings in Cucso, Peru against John Dougherty and Jen Moore.

An immigration hearing was scheduled for 9 a.m., Monday, April 24 at immigration offices in Cusco.

Upon the advice of legal counsel, Mr. Dougherty and Ms. Moore left Peru on Saturday. Peruvian attorneys will represent Mr. Dougherty and Ms. Moore at the immigration proceeding. Mr. Dougherty intends to contest the immigration case and is pursuing all other legal remedies. The police allege Mr. Dougherty was prohibited from screening the film under a tourist visa. Filmmakers attending film festivals routinely enter Peru under tourist visas.

“I strongly believe that Hudbay directed the Peruvian National Police and immigration authorities to detain us because Hudbay does not want the Peruvian people to know the truth about its long history of environmental contamination, allegations of serious human rights abuses and conflicts with local communities near its Constancia mine in Peru,” Mr. Dougherty says.

“Hudbay has had a contract to pay the Peruvian National Police for security services in the past and I believe that such an agreement is still in place,” Mr. Dougherty says. “The company is now taking the dangerous step of using the state to criminalize a journalist engaged in the distribution of truthful information that it wants to hide.”

This relationship between Hudbay and the Peruvian National Police has previously been reported in the media and elsewhere.

At no time since the film’s release in October 2015 has Hudbay stated there was an error of fact. “Hudbay was given every opportunity to comment on the film during the production and refused,” he says.

Hudbay also appears to have direct influence over the Peruvian Interior Ministry, which issued a statement Saturday (English translation) that strongly suggested criminal charges were being prepared against Mr. Dougherty and Ms. Moore for allegedly inciting rural communities to take violent actions against Hudbay.

“In fact, the documentary shows Hudbay’s contract employees, the Peruvian National Police, taking violent action in Nov. 2014 against Peruvian citizens peacefully marching and protesting Hudbay’s alleged failure to abide by agreements,” Mr. Dougherty says.

At no time during question and answer sessions after the screenings of the film in Peru did Mr. Dougherty suggest or encourage any violent action against Hudbay or any other mining company. Ms. Moore made no public statements during any of the events. Her role was to act as a translator for Mr. Dougherty.

“The fact that Ms. Moore was detained for doing nothing more than translating shows how far Hudbay and its police contractors are willing to go in its shameful attempt to silence free speech and intimidate the press,” Mr. Dougherty says.

The film screenings in Chamaca, Velille and Cusco were free and open to the public. DVD copies of the film were distributed free and Mr. Dougherty encouraged their reproduction and distribution. Hudbay and other mining supporters were welcome to attend the events and ask questions about the film, which they did.

Hudbay’s effort to stop the distribution of the film will not succeed. The film will be shown at 6 p.m., Tuesday, April 25 at CCPUCP, Avenue Camino Real, 1075 San Isidro, Lima.

Mr. Dougherty will attend the screening and answer questions via Skype.

The documentary, dubbed in Spanish and Quechua, reports on Hudbay’s history of contaminating Flin Flon, Manitoba, Canada with heavy metals and poisoning children; legal proceedings in a Toronto civil court where the company stands accused of murder, a shooting that paralyzed a man and gang rapes in Guatemala; conflicts with Peruvian communities where police used teargas and beat peaceful demonstrators and Hudbay’s plans to build the Rosemont open-pit copper mine in the Santa Rita Mountains southeast of Tucson.

Mr. Dougherty’s tour in Peru was assisted by Cooperacción and Derechos Humanos Sin Fronteras – Cusco. These groups arranged for screenings in different communities where they have developed relationships with community leaders. The organizations had no role in the financing, production, and editing of the film. Mr. Dougherty paid for all his expenses in Peru and conducted no commercial business.

Quechua version:

Spanish version:

 

Vancouver Island University added to Flin Flon Flim Flam tour

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InvestigativeMEDIA has added Vancouver Island University to its list of July screenings as it concludes its cross-Canada tour presenting the documentary film “Flin Flon Flim Flam.”

The film will be shown in five locations in British Columbia between July 9 and July 15.

“I’m delighted that professors at Okanagan College and Vancouver Island University are sponsoring screenings of the film that documents Toronto-based Hudbay Minerals’ worldwide operations,” said filmmaker John Dougherty.

“This documentary brings an important message to Canadians about the operations of a multinational mining company that is rarely discussed in the mainstream media that is suppressed by Canada’s right-to-reputation law,” he said.

The film documents how Hudbay Minerals contaminated its home town of Flin Flon with heavy metals; stands accused of human rights atrocities in Guatemala that has attracted coverage in the New York Times and the Toronto Star; used the Peruvian National Police to beat demonstrators at its Constancia mine site and is seeking to destroy one of the world’s most sensitive desert-aquatic environments in southern Arizona.

Amnesty International’s Human Right Radio interviewed Mr. Dougherty in June on CJTR 91.3 FM in Regina. The interview is available as a podcast from Amnesty International’s Human Rights Radio.

Mr. Dougherty will answer questions from the audience following each screening. Admission is free.

The tour continues in July with screenings at 7 p.m., July 9 at the Okanagan College Lecture Theatre, Kelowna; 3 p.m., July 10 at the Salmar Classic in Salmon Arm; 7 p.m., July 12 at the Cinematheque in Vancouver; 7 p.m., July 14, Vancouver Island University, Building 200, Theatre Room 203, Nanaimo, B.C. and 7 p.m., July 15 at The Vic in Victoria.

Documentary about Hudbay Mining gaining attention during Canadian tour

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REGINA, Saskatchewan—Arizona investigative journalist John Dougherty’s cross-Canada tour showing his documentary film “Flin Flon Flim Flam” was featured last week in a Canadian newspaper story and a one-hour radio show hosted by Amnesty International.
The radio interview was broadcast live on CJTR 91.3 FM in Regina and is available as a podcast from Amnesty International’s Human Rights Radio. The wide-ranging interview discussed the key facets of the documentary that focuses on Toronto-based Hudbay Minerals’ worldwide operations in Manitoba, Guatemala, Peru and Arizona.

The issues highlighted in Dougherty’s film continue to receive national and international attention. Just today, the Toronto Star reported on the far-reaching implications of criminal and civil legal proceedings occurring in both Guatemalan and Canadian courts regarding the murder of a leader of a local indigenous community in that Central American country.  In today’s, article Hudbay remarkably would not acknowledge whether or not it is paying the legal costs of the alleged murderer.

The Toronto Star article comes on top of an April New York Times article critical of Hudbay’s role in the same case. [Read more…]

After Successful Canadian Debut, More Screening Dates Added for Hudbay Documentary, Flin Flon Flim Flam

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(Chicago) After a successful debut in Toronto, Montreal, and Ottawa, InvestigativeMEDIA is adding three locations on its trans-Canada tour to screen its groundbreaking documentary “Flin Flon Flim Flam”.

The 51-minute film documents the notorious history of Toronto-based Hudbay Minerals’ worldwide operations. Hudbay is one of Canada’s oldest mining companies and was featured in a critical story earlier this year in The New York Times for alleged human rights abuses in Guatemala.

The exposé reveals Hudbay’s widespread environmental contamination of its primary operating base in Flin Flon, reports on allegations of murder, gang rapes and shootings in Guatemala, reveals Hudbay’s hidden conflicts with indigenous people in Peru and the company’s plans to destroy one of the world’s most biologically-diverse ecosystems in Arizona that is home to the only known wild jaguar in the U.S.

In addition to six upcoming screenings in June including Winnipeg on June 7 and Flin Flon on June 10, InvestigativeMEDIA has added three stops in British Columbia in July.

The film will be shown at 7 p.m., July 9 at the Okanagan College Lecture Theatre in Kelowna; 3 p.m., July 10 at the Salmar Classic in Salmon Arm and  7:00 p.m., July 15 at The Vic in Victoria. InvestigativeMEDIA will also show the film in downtown Vancouver at 7 p.m., July 12 at the Cinematheque.

“Concerned Canadians who attended the first three screenings stayed after the film and engaged in a vigorous discussion about mining issues in Canada and abroad,” says InvestigativeMEDIA’s John Dougherty, the film’s director. “Hudbay has operated with near impunity for more than 85 years. It’s time to hold the company responsible for its environmental and social abuses.”

Future Canadian Screening Dates

Date & Time City & Theater
June 7, 2016 Winnipeg
7:00 PM Cinematheque
June 10, 2016 Flin Flon
7:00 PM Hapnot Theatre
June 14, 2016 Saskatoon
7:00 PM The Broadway
June 17, 2016 Regina
7:00 PM Regina Public Library
June 22, 2016 Calgary
7:00 PM Globe Cinema
June 25, 2016 Edmonton
4:00 PM Garneau
July 9, 2016 Kelowna
7:00 PM Okanagan College Lecture Theatre
July 10, 2016 Salmon Arm
3:00 PM Salmar Classic
July 12, 2016 Vancouver
7:00 PM Cinematheque
July 15, 2016 Victoria
7:00 PM The Vic