"It is important that investors have accurate and meaningful information about material mineral properties in order to make informed investment decisions."
The OSC found that 80% of the issuers’ technical reports it reviewed had some form of non-compliance with the requirements of Form 43-101F1. This form, among other things, requires disclosure of environmental issues, assessment of first-time mineral resources, mineral reserves, and the results of economic assessments for mining projects.
Most of the mineral properties described in the technical reports were located in North America (44%) while others were located in either South America (22%), Africa (20%), Russia or China (8%) or Australia (6%). The three primary mineral commodities discussed in the Technical Reports were gold (46%), copper (12%) or iron (10%).
The quality and accuracy of technical reports has been of concern to investors and regulators since the collapse of Bre-X Minerals in the early 2000s after Bre-X was found to have perpetuated a fraud to overstate gold deposits in the late 1990s.
With the company’s collapse Canadian investors – including individuals, major pension funds and institutional investors -- lost billions.
Fallout from the Bre-X case dragged on for years. In end-May this year, an Alberta court dismissed the remaining class action suits by investors seeking to recover losses after determining there was “no realistic prospect of realizing any significant recovery through the litigation and that the costs of proceeding were prohibitive. Parties to the suits would receive a paltry $5.2 million divided among them.