Investors tapped to fund gold fraud film – by Ben Bland (Financial Times – December 10, 2014)

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Jakarta – Two of the world’s toughest mining tycoons battle it out with a star geologist, a chancer and a dictator’s children for control of one of the world’s largest gold discoveries in the heart of the Indonesian jungle, until it is exposed as a huge fraud.

The true story of Canadian company Bre-X Minerals, which collapsed in 1997 after attaining a market capitalisation of $6bn, reads like a movie script and the producer of hit film Home Alone is trying to raise $18m from mining investors to put it on the silver screen.

Malcolm Burne, a serial mining entrepreneur and former Financial Times journalist, has given Hollywood producer Scott Rosenfelt $150,000 of seed capital and together they are tapping minerals investors from Canada to Australia to fund a film about a scandal that changed the industry.

“It’s an amazing story with political and financial intrigue and thousands of people’s lives shattered as well as those who are still standing tall like Peter Munk of Barrick Gold,” says Mr Rosenfelt, who has tentatively titled the film Bre X: King for a Day.

Gold-mining companies struggled to raise money for years after the fraud, which prompted stock market regulators in Canada and Australia to bring in rules forcing miners to disclose detailed technical information about new finds.

No one was convicted of wrongdoing in relation to Bre-X and the last class action suits brought by disgruntled investors in Canada were wound down earlier this year.

“The problem was corruption on one side and greed on the other,” says Kuntoro Mangkusubroto, who was the government’s director-general of mining at the time. “It was an unbelievable experience. I was sacked and investigated by the police.”

He managed to resurrect his career, becoming a senior adviser to former president Susilo Bambang Yudhoyono, who just stepped down. Many others were not so fortunate.

Soon after the scam was revealed, a dead body thought to be that of geologist Michael de Guzman was found after it had fallen from a helicopter in mysterious circumstances near the Bre-X mine site in Kalimantan.

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