Saturday, May 4, 2013

To GBGD: Liar Liar Pants on Fire

What else can you say about Global Gold Corp. (Otcqb: GBGD) when you read their latest 10-K annual financial report which was published on April 16, 2013.

GBGD's only real asset , the Toukhmanuk Gold Project in Northern Armenia, was Refused the License Renewal of its exploration, yet GBGD fails to disclose this in their 10-K Filing. Mr. VAN Z. Krikorian Likes to spin Words Which are clearly designed to mislead Investors . Instead of admitting that their application to renew their exploration license was refused, they state:

On May 22, 2008, the government of Armenia issued a "special exploration license" to the Company for the Toukhmanuk mining property. The License was effective May 13, 2008 to expire on May 13, 2010 was an Extended for Additional Two years and as a matter of right Pursuant to the Armenian Mining Code is Being Extended until May 13, 2015 .

As a matter of right? Defined by who? The exploration license was not renewed in 2012 and this should have been disclosed in their 10Q filings and their 10-K. To claim the license is BEING extended is wishful thinking, not fact. It appears that GBGD is fighting the Government of Armenia to get the exploration license back, but that does not appear to have happened yet. Is this a material fact? You bet your stock price it is!

GBGD can not even operate the Toukhmanuk Gold Mine in Armenia because their application for their 3rd tailings damn has not been approved. Even the local residents of the Village of Meliq refuse their support, which is required under the law for such a permit to be issued. The Environmental NGO's in Armenia are out in full force demanding the project be stopped and have even sent Mr. Van Krikorian a letter demanding this (information as reported in local Armenian media). Yet they never disclosed this in their 10Q or 10K filings. Is this material? You bet your stock price it is!

You can not operate a mine without a tailings damn. GBGD may eventually get approval but they have failed to disclose their application was refused.

When is GBGD going to come clean and disclose they have lost the ability to operate in Armenia. Time for Global Gold management, Mr. Van Z. Krikorian, the Principal Executive Officer, to leave, along with his well trained manager and fixer in Armenia, Mr. Ashot Poghossyan, and some new Faces Get in there and to operate That know something about Corporate Governance and Compliance.

Unfortunately GBGD corrupt Government relied on the help of their friend Mr. Koryoun Hagobyan, the Head of the Concessions Department of the Ministry of Energy and Mines of the Republic of Armenia . Mr. Hagobyan is an undisclosed shareholder of rake LLC, an Armenia based mineral Services firm, Which was established in 2005 and became GBGD's largest supplier. RAKE has received millions of dollars of contracts from GBGD, and RAKE had absolutely no operating history. Mr. Hagobyan's magic obviously does not work anymore for GBGD or else they never would have lost their exploration license or tailings damn permit. What is clear is that GBGD should be investigated for FCPA violations.

Right now GBGD's Subsidiary in Armenia is Being investigated for Tax fraud and money Laundering in Armenia. Its not as if GBGD does not know this. Their offices were raided in January 2012 by police investigators. So what does GBGD disclose?

"On January 12, 2012, the Armenian Court of Cassation Confirmed PRIOR trial and Appellate court rulings rejecting a Proposed Tax Assessment against the Company's Mego-Gold Subsidiary by the Armenian State Revenue Agency Related to an incorrect Claim Concerning Gold Production At Toukhmanuk as Well as incorrect applications of relevant Law. Subsequently, the State Revenue agency has intimated That it is investigating Continued investigations and Make Further Claims against the Company and may based on the same Matters previously adjudicated in the Company's favor .. "

Since 2011 GBGD has failed to fully disclose material information regarding their operations and legal problems in Armenia. It took GBGD a full year to disclose that it has problems with the tax authorities in Armenia.

Lets not forget the biggest disclosure change I have seen related to the Toukhmanuk Gold Project .... they need to mine 168,500 tonnes of ore per year. This is a new disclosure. Since 2009 GBGD has been misleading investors it had to mine 80,000 tonnes per year. Now the truth comes out and the fact they only have mined approximately 124,000 tonnes over the last 6 years. GBGD fails to disclose to investors how they are going to make up the difference of nearly 1 million tonnes of production shortfall by 2015. This license is technically in default and GBGD fails to disclose this in their 10K filing.

Hopefully oversight organizations in the US such as the SEC Enforcement (http://www.sec.gov/divisions/enforce.shtml) the PCAOB  (Public Company Accounting Oversight Board www.pcaobus.org)) and the US Department of Justice under the FCPA (http://www.justice.gov/criminal/fraud/fcpa), will finally expose what really is going on with GBGD in Armenia.


About this Blog:  Between 2009 and 2012 I was an active investor in the mineral exploration sector in the Republic of Armenia.  Our main project in Armenia was the MARJAN polymetallic gold and silver project located in near Sissian.  My JV partner, Mr. Van Z. Krikorian, President of Global Gold Corp (otcqb: GBGD) and Trustee of the Armenian Assembly of America, used corrupt means including using his influence with the US EMBASSY in YEREVAN to secure an indictment against me for theft of the JV and to corrupt the Armenia judicial system to give him a favourable ruling.

Mr. Van Z. Krikorian is the President, CEO and Legal Counsel of Global Gold Corp. (otcqb:GBGD), a penny stock listed on the OTC  markets. His public filings with the US Securities and Exchange Commission  fail to fully disclose the reality on the ground in Armenia in the promotion and development of GBGD's gold project, the TOUKHMANUK GOLD MINE.

This blog is an effort to bring transparency of the activities of Global God Corp. (otcqb: GBGD) and Mr. Van Z. Krikorian in Armenia.

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