By Tom Winnifrith, The Sheriff of AIM | Sunday 12 February 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Earlier today I served up a shocking document from the land of high culture which exposes a $2 million heist by Pirate Pete Landau. I think it is fair to say that the Pirate is in real trouble and will not be docking his ship at the AIM casino ever again. But he is not the only chap in the spotlight as a result of this scandal.
A fellow director of Citation was Anthony Eastman and the administrators verdict on him is damning. The good news for those chaps is that, at this stage, it is deemed uncommercial to pursue them for funds ( page 4).
The bad news. On page 17 Mr Eastman stands accused of co-authorising ( with the Pirate) the creation of the bank account that allowed the Pirate to half inch just over A$2 million. On page 21 the administrators attempt to see if Mr Eastman has assets worth going after but their cause has not been helped by Mr Eastman staying in the UK and refusing to co-operate in any way with the enquiry.
On page 23 it is made clear that there were potential serious offences committed by former directors (note the plural) and a 438D report is soon to be sent to the Australian FCA, ASIC.
So why do we care about Eastman? Because, unlike Pirate Pete, he has not gone away. On 7 October 2016 Mila Resources (MILA) raised £1.05 million before costs at 5p as it listed on the Standard List as an investment company looking to tap into the Natural Resources world. Natch it has made no investments to date. Its shares now trade at 6.25p-6.5p giving it a market cap of c£1.5 million. Natch Eastman and his fellow directors paid only 0.1p for their shares ( Eastman got 200,000 such shares) so they are sitting pretty – net cash is now likely to be sub £1 million with Eastman earning £24,000 per annum for his honest endeavours as do his two co-directors.
We are told in the prospectus that Eastman has a cracking CV:
Anthony is a Chartered Accountant (Australian qualified) with a number of years’ experience in financial management and corporate advisory services, primarily in the natural resources sector, along with extensive experience in the public company environment, having been a director and company secretary of a number of ASX and AIM junior mining and oil & gas focused companies. He has previously worked with Ernst & Young and CalEnergy Gas Ltd, a subsidiary of the Berkshire Hathaway Group of Companies in both Australia and the United Kingdom.
What a top man. I put it to you that Mila is uninvestable in light of the news out of Citation unless Eastman walks the plank with immediate effect.
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