AfroCan denies defrauding Lily Mine
Canadian gold mining company AfroCan Resources Gold on Monday denied allegations that it had deceived Vantage Goldfields over Lily Mine’s $11 million business rescue it promised to invest in the collapsed mine.
This follows accusations by trade union Solidarity earlier this month that ‘investor’, AfroCan, had defrauded Lily Mine and not paid the agreed upon $2.5 million as part of an $11 million investment to the mine by the June 30 deadline.
Afrocan, through its attorneys in Sydney, Australia, said Vantage had no grounds on which to bring action or any claim whatsoever against it, and that AfroCan would vigorously resist any such claim if it were brought.
"AfroCan denies much of the positioning and notes that certain statements are mere spurious allegations," AfroCan said in a statement.
Lily Mine operations in Barberton, Mpumalanga, were placed under business rescue after a shaft collapsed in February, trapping three workers underground after a container they were in plunged into a sink hole.
The mine has not been able to pay workers since March and operations were put under business rescue.
Also, AfroCan failed to transfer $1 million from its Mauritian bank account on June 1 due to regulatory problems on AfroCan’s side.
The money would have been used to pay the mine workers’ salaries for April and to start the sinking of a new entrance to the mine.
Afrocan denied that it had reneged but said based on "difficulties facing AfroCan’s investor-base", it had no option but to withdraw from the transaction.
Afrocan said the intention of a media onslaught was to intimidate and leverage the risk of loss of reputation to coerce one party to perform to the will of the other.
"AfroCan shall not be coerced by the recent media reports nor will it succumb to threats of continued intimidation."
AfroCan chief executive, Brian Barrett, also laid blame on Vantage chief executive Michael McChesney for doing an about-turn on the deal.
"The about-turn by Vantage just two days after McChesney confirmed in a letter that the parties had commenced a joint process aimed at removing the obstacles to concluding the transaction, combined with the aftermath of Vantages’ subsequent malicious media attack on AfroCan, may have scuppered any chance of AfroCan getting its stakeholders and investors back to the table," Barrett said.