Indonesia, RCMP to investigate Busang gold case
Indonesia, RCMP to investigate Busang gold case
JAKARTA (JP): The national police has formed a team of
investigators in cooperation with Canadian police for a
preliminary probe into the Busang scandal, the national police
spokesman said yesterday.
Brig. Gen. Nurfaizi told reporters the team for the
preliminary investigation consisted of several detectives and
experts from the Ministry of Mines and Energy with Col. Arifin
Rachim as team leader.
The team would collect data and evidence connected to the
scandal to assess if a crime had been committed, Nurfaizi said.
The Indonesian government ordered police to investigate the
Busang scandal after a report by independent consultant
Stratchona Mineral Services Ltd. on Sunday claimed Canada's Bre-X
Minerals Ltd. world's biggest gold find was a hoax.
Stratchona said the Busang site in East Kalimantan, which Bre-
X said contained 71 million ounces of gold, contained no economic
gold deposit and was a falsification of data.
Reports said Bre-X geologists had tampered the core samples
taken from the Busang site before sending them to an assay lab in
the East Kalimantan capital of Samarinda.
The government froze the activities of Bre-X and its
subsidiaries in Indonesia one day after the report was released.
Nurfaizi said an officer from the Royal Canadian Mounted
Police (RCMP), Douglas R. Herda, based in Singapore, had talked
with the national police yesterday on the possible cooperation
between the two police forces in probing the scandal.
"Indonesian and Canadian police have agreed to cooperate. If
necessary, we can use their information or ask Canadian police to
be witnesses," Nurfaizi said.
Canadian Ambassador to Indonesia Gary Smith said yesterday
RCMP sent Herda to Indonesia after receiving two requests for an
investigation into the scandal from Bre-X and the Ontario
Securities Commission (OSC), Canada's top securities regulator.
In a letter to the RCMP, Bre-X Chief Executive David Walsh
said fraud had been perpetrated against his company, but he did
not identify the suspect. He also promised to fully cooperate
with the police.
The OSC is conducting an investigation into Bre-X for possible
violations of insider trading and disclosure laws.
"So far there isn't any suspect in this case," he said.
Smith said there was no extradition agreement between Canada
and Indonesia but added this would not hamper the investigation.
Smith also said a number of journalists from Canada were in
Indonesia to report on the case. Some of them wanted to write
books on the scandal.
The Philippines embassy here said Thursday Herda and officials
from Price Waterhouse had questioned three Filipino geologists in
Samarinda who worked under their compatriot, Bre-X chief
geologist Michael de Guzman. The three geologists were Manny
Puspo, Bob Ramirez and Sonny Imperial.
Guzman mysteriously died in March after allegedly committing
suicide by jumping from a helicopter on his way to Busang.
Several days after, Bre-X partner in the Busang project,
Freeport McMoRan Copper and Gold of the United States, announced
it had found no significant gold in Busang.
Bre-X shares drastically tumbled after the announcement and
forced the company to hire Stratchona for an independent samples
test.
The Busang project was 45 percent owned by Bre-X, 30 percent
by the Nusamba group and its Indonesian partners, 15 percent by
Freeport and 10 percent by the Indonesian government.
Nusamba, Freeport and the Indonesian government have withdrawn
from the consortium.
Yesterday Bre-X announced it had fired its chief of
exploration John Felderhoff.
Felderhoff, who now lives in the Cayman Islands, has expressed
dismay over the tampering at Busang and denied any involvement.
(jsk/cst)