These don’t even go back very far, but it’s fun to remember what’s been and gone.
Bre-X a mystery of salting and suicide: In 1993, Bre-X chairman David Walsh went to Indonesia and met geologist John Felderhof, who had co-discovered the Ok Tedi copper-gold mine in Papua New Guinea.
Many larger mining companies had looked at Busang and said no but by the end of the year, Bre-X had started to report some favourable results from its drill samples.
Canadian Bre-X gained the following of some top producers including Barrick Gold, Placer Dome and Freeport-McMoRan, which tentatively agreed to help develop Busang.
Indonesia’s Suharto regime managed to grab 40 per cent of the deposit for Indonesian interests. Bankers from Lehman Brothers, and JPMorgan were recommending it to clients on the back of statements from the company that the site might contain 200 million ounces of gold, worth more than $US240 billion at today’s prices.
Placer Dome and Barrick Gold were never allowed to do their own drilling and by April 1994, Freeport reported the first independent results, albeit preliminary, saying it had found insignificant amounts of gold.
This brought accusations that the original Bre-X core samples had been salted – sprinkled with gold from other sources.
Freeport was about to take control of the project as doubt began to increase about the validity of the original claims when a fire destroyed a cabin at Busang. It had contained all the geologists records.
Several months later on March 19, the exploration manager, Michael de Guzman, was in a helicopter flying to meet with Freeport’s due diligence team.
But he never arrived, allegedly plunging 600 feet into the jungle. His death was ruled by police to be a suicide and a decomposed body was found in the jungle and supposed to be his.
However, some still believe that de Guzman faked his death to live happily ever after somewhere on the funds made from earlier cashing in his shares at the dizzying heights the Bre-X stock reached when the company’s value peaked at more than $US5billion.
Copper king Hamanaka loses his crown: Yasuo Hamanaka was jailed for eight years for fraud and forgery in 1997. The Sumitomo Corp copper trader from Japan lost his company more than $US2.6billion as he made unauthorised trades for more than 10 years
At the height of his deceit between 1985 and 1996, Hamanaka apparently controlled 5 per cent of the global copper market, earning him the nickname Mr Five Per Cent.
Off-the-book trades forced up prices and made his company large profits for years. A year after his conviction, Sumitomo paid about $US150million to settle claims from British and US regulators although it did not admit or deny allegations that it knew Hamanaka was using bogus trades to drive the copper price higher for several years.
Chinese copper trader missing after massive losses: Liu Qibing may or may not have been a metals trader for the Chinese government in 2005, his identity and work engagement remain a state secret.
Allegedly, while he was working for the Chinese state, the government took a huge bet of around 200,000 tonnes that copper prices would fall.
But they didn’t, and as the price of copper rose substantially over the life of the trade while demand for copper increased, massive losses were incurred.
The paper trail apparently led back to the Chinese State Reserve Bureau and other traders knew China would have to fill the amount shorted.
Copper prices rocketed, and while the Chinese government tried to depress prices by claiming copper reserves were greater than previously estimated, it also denied that Liu Qibing ever existed.
Bunker Hunts attempt to corner silver market: With wealth made from oil, former billionaire Nelson Bunker Hunt’s fortune collapsed after he and his brother, William Herbert Hunt, attempted to corner the world market in silver.
They accumulated large amounts of silver in the early 1970s and by 1979 had almost cornered the global market.
With an estimated holding of 100 million ounces of the precious metal, they apparently earned between $US2billion and $4billion by speculating in silver.
Silver rose from $US11 an ounce in September 1979 to around $US50 an ounce by January 1980.
But the price collapsed and Nelson Bunker Hunt filed for bankruptcy in September 1988, mainly because of lawsuits brought against him regarding the speculation.
Nelson Bunker Hunt was fined $US10million in 1989 and banned from trading in commodity markets.
Enron implodes as accounting loopholes discovered: Enron imploded in October 2001 as it emerged that the American energy company from Houston, Texas, had been using accounting loopholes and poor financial reporting to hide billion in debt from failed deals and projects.
At the time it was the biggest bankruptcy reorganization in US history and it brought down audit and accountancy partnership Arthur Andersen as a result.
Under the direction of Kenneth Lay and Jeffrey Skilling, staff including chief financial officer Andrew Fastow misled Enron’s board and audit committee.
Once the scandal was uncovered, the stock price that pierced $US90 in mid-2000 sunk to less than $US1 by November 2001. Enron filed for bankruptcy on December 2, 2001, with assets of $US63.4 billion.
Hedge fund Amaranth collapses after trader gambles on natural gas futures
Hedge fund Amaranth Advisors, with more than $US9 billion in assets, collapsed in 2006 after natural gas trader Brian Hunter lost a big gamble on natural gas futures.
Hunter had made large profits by speculation on natural gas prices, but he lost $US6.6 billion in 2006 after betting that the price of gas would rise.
Prices went the opposite way, however, after a heatwave, and Hunter took a fall as well.
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