Mining companies from B.C. to New Brunswick and Nova Scotia have filed a federal court challenge to a B.N.O. ruling that concluded the companies engaged in a massive fraud scheme to make billions of dollars by mining gold and copper deposits in northern Ontario.
In doing so, the B.P.I. accused the companies of “fraudulently concealing” that their business was a gold-mining operation and that they were actually extracting gold from an ore-bearing rock in an area that had been mined by British Columbia’s Westmorland Mining Corporation (MWC).
The mining companies had been awarded a $3.3-billion settlement in 2016 from the B:Copper Board of Directors.
The B.B.C.-based B.S.M.I., a subsidiary of MWC, said it had spent $3 million in the past two years to defend itself against the suit.
The suit was filed in B.F.T.U. Superior Court in Vancouver on Thursday.
M:Coppers [B.P.-Copper Mining] Corporation is entitled to be held liable for the fraud of its employees, the misrepresentations of the facts and the deception of its customers, especially in this instance, that it is mining the gold and silver in a mine in Bandon Lake, Ont.,” said the suit filed by B.E.P., the Bancroft Gold Group, B.R. Co-operatives and a number of other mining companies.
The complaint said MWC “intentionally” deceived its customers about the nature of its operation by providing a misleading description of its operations to them.
“It is apparent that MWC was not the sole operator of this mining operation,” the complaint said.
“MWC was operating in conjunction with other mining corporations.”
“We are pleased to have prevailed on this matter,” said Steve Fenton, president of the B,P.S., Mining Association of Canada.
“This is an extremely important case, and it will have a significant impact on the Canadian gold industry.”
The Bancropatch Mining Company, which operates the Westmorlands Mine, is also involved in the lawsuit.
“We’re pleased that the Banchropatch and Bancopatch companies have agreed to join us in a joint effort to ensure that our interests are protected, and that all of the parties can continue to operate in a legal, safe and professional manner,” said David Trommel, president and CEO of the West Morlands Mine.
The plaintiffs allege that the mining companies engaged the “foolish and fraudulent” conduct of concealing that the gold was extracted from a mining prospect in the Bandon Mine in the early 1970s.
They also allege that MWCC’s mining operation was a fraudulent scheme that resulted in “gross and repeated deception” of customers and shareholders.
A BCSC spokesperson said that the BCSC was not aware of the BCI lawsuit when it was filed.
“BCI is confident that the facts of this case will be determined in a fair and expeditious manner and that BCI and the BC companies will fully cooperate with the BCB,” said the spokesperson.
“In light of the recent BCI announcement, we have no further comment at this time.”