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Crystallex on the Regulator’s Radar

by: Bill Cara March 14, 2007 | about stocks: KRY    

Bill Cara

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Not surprisingly, the securities regulators have required Crystallex (KRY) to make a statement as to speculation in the press. Here below is its statement. But, with all due respect to my friends at Crystallex, they might have acknowledged that their new senior management had something to do with this.

TORONTO, ONTARIO, March 13, 2007 – Crystallex International Corporation at the request of Market Regulation Services Inc., on behalf of the Toronto Stock Exchange, Crystallex International Corporation is making the following statement concerning the increase in its stock price and trading volume which may have been influenced by recent speculation in the press concerning the possibility of Crystallex being the target of an unsolicited takeover bid:

“As a matter of Corporate Policy, Crystallex does not comment on rumors or speculation. There are currently no corporate developments concerning Crystallex of which management of the Company is aware and the Company has no announcements to make at this time.”

The Company will continue to update shareholders with news in a timely fashion.

There is one reason, and one reason only, that I wrote up Crystallex in this blog, and his name is Todd Bruce. Todd was fired six weeks ago for no good reason. Perhaps these businessmen and stock promoters can do a better job? I think not. I’ll even go so far as to speculate that the auditors, Deloittes, also thought not, and decided to resign the engagement.

We’ll never know, of course, but Deloittes only took this job after the previous auditor became less than enchanted with previous management (prior to the hiring of Todd Bruce) also, and, like Deloittes, quit. I believe that the hiring of Todd Bruce was a large part of the reason Deloittes took over as auditors.

And when I saw reports that the new CEO was up to their old tricks of leading people on with respect to the timing of the environmental permit, and then the auditor quit soon after, I decided to put two and two together. Now we have the demand from the securities regulators, so I can add another two to get six.

If these guys don’t watch it, that will be a deep six.

As to the company’s prospects, I think it hopes to get the permit soon and then put the company up for sale. Monday there was a rumor that BMO has been hired to investigate on behalf of the Russian goldminer Polyus. In the report that came out in one publication, I read the laughable statement that one could assume that Venezuela would prefer to deal with Russians than Canadians.

The amount of garbage I read about this company is unbelievable. It all starts somewhere. In the case of Todd Bruce, I can assure you it wasn’t him. Moreover, I have many reasons to believe it is not Richard Marshall, the IR vice-president, who has always handled himself professionally with me.

This company holds a valuable asset, which I believe will become another company's asset this year. The KRY shareholders will ultimately benefit, I also believe.

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This article has 6 comments:

  •  
    Mar 14 03:07 PM
    How long will it take for shareholders of Crystallex to figure out this company has no clothes? This situation reminds me of 3 Card Monte. No matter what you point at the answer is always the same. The new management is sitting in their tin shack under a few dripping palm trees trying to figure out the next move. The CEO is wiping sweat of his forehead with old stock options. This stock is like a can of rotten tuna fish. Sooner or later someone is going to open the can and stink up the house. It's time to expose the management and its lack of attire.
    Reply
  •  
    Mar 14 07:24 PM
    The post is a showcase of Cara's dishonest posting style.

    Cara claims that there was only "one reason" he recommended KRY as a buy, namely, ex-CEO Todd Bruce.

    Go back to Cara's January 3 post wherein he anointed KRY as his "2007 Stock of the Year":

    gold.seekingalpha.com/...

    Notice anything? What I noticed was that there was ABSOLUTELY NO MENTION by Cara of CEO Todd Bruce. Certainly nothing to support his claim that Todd Bruce was the only reason why the company is worth buying.

    Jump forward a bit to when Todd Bruce was fired by KRY's board. Did Cara tell you to drop the stock, since his "only reason" to own the company was now unemployed? No - just the opposite. He took Bruce's firing as a reason to again tout the stock as being "in play" as a takeover candidate. Here's the proof:

    On February 1, Cara opined: "A big piece of news for this Board is that Crystallex has replaced Todd Bruce with Gord Thompson as CEO, and the company says they are close to getting the environmental permit. If the latter is the case, then my friend Todd is leaving for one reason; this company is going to be in play as majors Gold Fields, Barrick, Goldcorp and IAMGOLD will be throwing their acquisitor's hat into the ring. Stay tuned with KRY."

    www.billcara.com/archi...

    Cara's final dishonesty in this post comes from the fact that he castigates KRY's current management in this post for being up to "old tricks" for "misleading people" as to the status of their long-sought-after environmental permit. Yet he totally ignores the fact that his friend Todd Bruce has a long history of making exactly the same kinds of misleading claims about the permit. Here are at least three different times when Todd Bruce claimed the granting of the permit was imminent:

    www.twst.com/ceos/AEF6...
    gold.seekingalpha.com/...
    www.prnewswire.com/cgi...;STORY=/www/story/07-2...

    Cara is legendary in making excuses and bogus claims, such as these discussed here. He should apologize for misleading people into buying KRY and losing them a quarter of their money since January 3.
    Reply
  •  
    Mar 14 07:27 PM
    Cara continues to tout KRY. How far lower does it have to drop before he admits his error?
    Reply
  •  
    Mar 15 10:37 AM
    I have wrote to the company twice and I got no answer.They never tell you anything. I think it's about time to tell Chavez to give the permit or we will pull out. Look what happened in Africa, Barick and Polyus, the two largest gold miners pulled out. Been waiting since 2004 for permit. Something really stinks here, maybe sombody is starting to open the can of tuna fish.???Thank you for the coverage you give us and keep up the good work.
    Reply
  •  
    Mar 15 04:51 PM
    "After Zimbabwe, Venezuela is considered the second worst place to do business by the mining industry."

    See MarketWatch article:
    www.marketwatch.com/Ne...={231265AA-1DD5-4318-8...

    CrossProfit
    www.crossprofit.com
    Reply
  •  
    Mar 15 05:49 PM
    What I find amusing in Cara's original posting is his present claim that the "one reason, and one reason only" that he began to tout KRY was because of now-fired CEO Todd Bruce. Cara ascribes truthfulness and purity of intent to his friend, which excoriating present KRY management for the "tricks of leading people on with respect to the timing of the environmental permit."

    Todd Bruce was one of the worst offenders in making empty claims about that ever-elusive environmental permit. Here is an interview Bruce gave in June 2006 where he promised the KRY is "in the final administrative stages of being issued the final environmental permit."

    www.twst.com/ceos/AEF6...

    Yet Cara dishonestly gives his friend a pass, while implying that the lying over the environmental permit is a fault only of current management.

    New news today - KRY's Chief Financial Officer quit or was fired. Yet Cara still refuses to rescind his "buy" recommendation. Which leads to the question: What kind of malfeasance on the part of KRY would cause Cara to change his buy recommendation?
    Reply
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