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World of Secrets
The Six Billion Dollar Gold Scam: 6. The end of the bonanza
00:37:32
With Bre-X stock halted on the financial markets, a terrible truth emerges
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- [00:00]
Suzanne Wilton
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- [00:06]
Jim Bob Moffett
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Suzanne Wilton
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Jim Bob Moffett
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Suzanne Wilton
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Jim Bob Moffett
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- [01:07]
Suzanne Wilton
O.Com from the BBC's investigations podcast, World of Secrets, here's the sixth episode of our guest season, the $6 billion Gold Scam. From the BBC World Service and CBC, over to Suzanne Wilton. First, a warning. The following episode contains difficult subject matter, including references to suicide. In the immediate aftermath of De Guzman's fall, things were chaotic. Lawyer Tom Adjameh, heard here in the Breech's tapes, was trying to investigate what had happened on behalf of Breec's shareholders.
- [01:55]
Jim Bob Moffett
Do you have an. Do you have an active theory about the Guzman?
- [02:01]
Suzanne Wilton
I really don't.
- [02:02]
Jim Bob Moffett
I mean, just speculation at this point. From what I've talked to all my people about Indonesia about, a lot of people that I know think suicide and some possibly think he was killed.
- [02:15]
Suzanne Wilton
Freeport President Jim Bob Moffet needed time to find out exactly what had been going on at Busang. Moffitt kept quiet for the time being at least. Speaking to journalist Richard Behar, he explained this was in part to protect Freeport.
- [02:36]
Jim Bob Moffett
We had no obligation to say anything to the Brex shareholders as long as we didn't talk about this to anybody. Right? Right.
- [02:42]
Suzanne Wilton
He knew that a Boeing 747 loaded with core samples dug up by Bre X was flying out of Indonesia. The samples were on their way to a lab in New Orleans. If there really was no gold in Busang, then maybe these samples could explain why everybody had Thought there was, but this was going to be difficult following de Guzman's death.
- [03:12]
Jim Bob Moffett
But the thing that forced this thing out in the open was de Guzman jumped out of that goddamn helicopter. But now we've got the whole world saying, what's a 40 year old guy who's at the top of his career and rigged, okay, jumped out of a helicopter, okay, but still.
- [03:24]
Suzanne Wilton
And the press wanted answers.
- [03:27]
Jim Bob Moffett
I've been accused of everything that you can imagine by this goddamn Canadian press because we wouldn't talk to him. Canadian press said I was doing it to take over Breac and that I had de Guzman killed.
- [03:44]
Suzanne Wilton
After de Guzman's fall from the helicopter, Briak's stock was halted on the exchanges while the waited for an announcement. Six days after the fall, on 25 March, while Freeport was still staying quiet, David Walsh, the CEO of Bre X, revealed in an interview with CBC News that de Guzman had taken his own life. Walsh said that on his way back to Indonesia, de Guzman got a checkup at a hospital in Singapore. Walsh said the hospital faxed de Guzman's hotel before he left for Busang, telling him he had hepatitis B which was non curable and would have been a very painful lingering end to his young life. Walsh said they'd recovered a five page suicide note from the helicopter which he'd left to his family and John Felderhoff, saying he'd had enough physical pain over the years. He'd had 14 bouts of malaria and was ending it. David Walsh added, we're taking it as a suicide note. I've got a copy of it and it's in his handwriting. Meanwhile, in New Orleans, Freeport geologist Andrew Neal was now in receipt of original BRE X core. He was hoping it would tell him what had been going on with the gold at Busang. I'm Suzanne Wilton from the BBC World Service and CBC. This is the $6 billion gold scam. A story about the lengths people will go to in pursuit of getting rich. This is episode six, the End of the Bonanza.
- [05:51]
Jim Bob Moffett
So Wednesday at about noon, I get a phone call from John Macken, who is the chief operating officer of Freeport. He says, you're not going to believe this. I said, what? He says, de Guzman just fell out of a helicopter. I said, no, no, no, no, no, that didn't happen. He said, no, that's what we're being told. He fell out of a helicopter. He said, we really need to know what's going on here. I went to the lab, guys, I said, guys, we've got to work on this sample right now. I says, but strict protocols. I said take off any jewelry. Nobody wearing any gold chains, nobody can put anything into it. Now they're sensing the criticality of what's going on. Now there's some very simple test work to be done in terms of evaluating whether there's any gold in the sample. And we had all the equipment, we put it under scanning microscopes and also binocular microscopes and boom, there's all this coarse gold in that sample.
- [06:53]
Suzanne Wilton
So what does that mean?
- [06:54]
Jim Bob Moffett
Well, you know, right away it's come out of a stream because of the striations on it. And it's much coarser than the mineralization in the rock.
- [07:07]
Suzanne Wilton
The gold had tiny grooves and scratches having been dragged along the stream bed. If the gold was in the drill core from deep underground, it shouldn't have these marks.
- [07:20]
Jim Bob Moffett
We just look at it and first thing we said is, did somebody's jewelry fall into the sample? Because by standards it's a big piece. And we looked at it and we looked at it and it was immediately clear that somebody had added that gold into the sample.
- [07:36]
Suzanne Wilton
You had in your hands a salted sample.
- [07:39]
Jim Bob Moffett
It was quite clear that anything that happened had happened in Busan.
- [07:45]
Suzanne Wilton
You'll remember the so called salting.
- [07:48]
Jim Bob Moffett
The reason it's called salting is the way they used to do it is they literally would put it in a salt shaker when the sample went into the bag. They take the salt shaker with the, with the gold in it, shake it into the sample. That's why it's called salting. This is what they were doing. This is such a giveaway when you look at it under a microscope. I knew it. We all knew it. This gold doesn't belong in this sample. But that was basically game over.
- [08:16]
Suzanne Wilton
Andrew Neal's discovery of salting was reported to Freeport boss Jim Bob Moffett, who instructed Neal to stay quiet. Here's Jim Bob Moffatt talking to journalist Richard Behar.
- [08:31]
Jim Bob Moffett
I put a complete shutdown on the staff. It has to be done completely by the book.
- [08:41]
Suzanne Wilton
Jim Bob Moffett couldn't go public until these results were double checked. But his silence left him open to conspiracy theories.
- [08:52]
Jim Bob Moffett
And it was just awful that these guys were convicting us of the men, you know, dealing in fraud activities to try to discredit Bre X. Briach's people told me directly that they believed that you and Hasan were behind a plot to lower the stock price. Well, what else could they tell you? If they tell you anything different then whether we're right or they're wrong.
- [09:17]
Suzanne Wilton
Meanwhile, Bre X vice president Brian Coats was now starting to fear the worst.
- [09:24]
Jim Bob Moffett
Once your chief geologist goes missing, once you got the clue about the missing data, then you start pulling in the stories from the office fire that was on site and a whole bunch of other things. Doesn't take long to say this is not a pretty picture.
- [09:44]
Suzanne Wilton
Four days after de Guzman's fall, a body was found on the swampy jungle floor. It had been partially eaten by wild animals and the face was missing. The fact they'd located a body was quite extraordinary considering this is dense jungle covering a vast area of 209,000 square kilometers. Journalist Jennifer Wells had been following the Breeck story from Canada and immediately flew out to Indonesia. While there, she hired a helicopter, the same type as the one de Guzman fell from, and she flew out over the East Kalimantan jungle, retracing his final journey.
- [10:34]
Jim Bob Moffett
It was just this landscape of green and it just seemed so peaceful and it just seemed so gorgeous. And you're trying to juxtapose that against all that he had left behind when he got into that helicopter. As I'm sitting there, I'm thinking, this makes no sense to me. As many people have said, if Freeport McMoRan is ordering you back to the site and you know it's a fraud, why are you going? What is your exit strategy to get into a helicopter? It's a real head game.
- [11:16]
Suzanne Wilton
The flight didn't give Jennifer any answers, just more questions. Jennifer managed to get a hold of a list of the items de Guzman had taken aboard the helicopter.
- [11:31]
Jim Bob Moffett
What Michael had left in the chopper, a suitcase with 20 rolls of film, a black leather bag with a Motorola handphone, a Seiko and Rolex wristwatch, two diamond studded gold rings, a gold bracelet, a calculator, a small wallet containing cash, business letters, a vest.
- [11:52]
Suzanne Wilton
Notably, there was no mention of the large black box that witnesses had seen being loaded onto the helicopter when it stopped to refuel in Samarinda.
- [12:03]
Jim Bob Moffett
Well, it says letters of last will written before falling out of helicopter. A black plastic bag containing clothing and three cases of Bintang beer. Bracket 72 cans in case you don't know how many cans are in a case.
- [12:18]
Suzanne Wilton
And is that you who underlined that?
- [12:20]
Jim Bob Moffett
Yes, clearly.
- [12:21]
Suzanne Wilton
Because that seems odd, doesn't it?
- [12:24]
Jim Bob Moffett
It seems very odd.
- [12:27]
Suzanne Wilton
Taking all that beer suggests de Guzman had planned to reach Busang. But then a suicide note was discovered on the helicopter, written in spidery handwriting. All of it taken together, had Jennifer's reporter instincts Kicking in, something felt off. Despite rumors circulating that de Guzman was murdered so Freeport could get their hands on the gold, Jim Bob Moffat continued to keep quiet as to just how ugly it was.
- [13:03]
Jim Bob Moffett
Not only have these guys not just improved the size of this deposit, but the more we get into it, it looks like they've invented the deposit. We're sitting on top of a time bomb. But we couldn't make that statement, man. The legal liabilities of us making that statement, because.
- [13:18]
Suzanne Wilton
No, I understand that Jim Bob was also concerned for Freeport.
- [13:24]
Jim Bob Moffett
I had to protect my shareholders. I wasn't going to let the Preax problem become a Freeport problem. By legal, we had no obligation to say anything to the Preex shareholders as long as we didn't talk about this to anybody.
- [13:38]
Suzanne Wilton
But at some point, Freeport's joint venture with BRE X and the Indonesian government would have to end because there was no gold to mine. This moment came a week after de Guzman's alleged jump from the helicopter. However, they still didn't mention the salting. They couldn't. Their results still needed to be independently checked. While Freeport was preparing to pull out, Vice President Paul Murphy met with the Canadian ambassador to Indonesia.
- [14:14]
Jim Bob Moffett
Moffitt asked me to go visit the Canadian ambassador in Jakarta and explain what's going on here and make sure it happens before the market opens in the US So first thing in the morning, I get an appointment with the Canadian ambassador. I explain what's happened, that we can't. We were drilling the twin holes, you know, we can't find the gold, and we're therefore withdrawing from the operation. And meanwhile, de Guzman has apparently committed suicide. The ambassador was furious, and he gave me a lecture. He said, do you realize how many Canadian shareholders have. In Canada? You know, every little town across the nation, people have shares in this. I'm convinced that your chairman and Bob Hassan are in cahoots together to squeeze out the little guy here, and you're going to come back in a year or two and, you know, take over the whole thing for yourselves. Get out of my office. You know, I was literally kicked out of the ambassador's office. He was fuming.
- [15:18]
Suzanne Wilton
While Ambassador Gary Smith didn't respond to our request to speak, it appears he may not have been convinced. While others were getting very nervous with little news coming out of Freeport, people tried to find out any way they could what was happening, including tapping Freeport employees like Andrew Neal for insider information.
- [15:48]
Jim Bob Moffett
I was getting phone calls from all over, people I hadn't spoken to for years, saying what's going on. We're under a strict confidentiality clause with Freeport. We couldn't talk about it. I actually thought our phones were tapped because, you know, again, we're talking billions of dollars here and, you know, I can't tell anything to anybody until we make a formal announcement.
- [16:11]
Suzanne Wilton
What was that like, holding onto that secret?
- [16:14]
Jim Bob Moffett
Well, I have to be quite honest with you, because you look like trusting people. I did phone my dad from a payphone. I said, dad, I can't talk, but I just have one question. Do you have any BRE X stock? And he said, no. And I said, okay, I'll call you later. So I broke the rules, and I've never told that to anybody but you.
- [16:39]
Suzanne Wilton
BRE X investor Warren Irwin, who'd immediately sold off his own stock after de Guzman jumped, also started warning anyone he'd advised to buy BRE X stock to sell.
- [16:52]
Jim Bob Moffett
Like, I had a list of 40 people I put into the stock. I called every single person who I put in the stock and saying, the stock's $220 or it's 250 or 280 or whatever. The point was, I'd phoned them every single one up. I was very diligent. I said, please sell the stock. I had these conversations, but the greed was just too great. And I wasn't able to convince anybody to sell the stock. One guy I knew was the largest shareholder in BRE X and he had $80 million worth of stock at one point. And I tried to convince him to sell 10 million, and he wouldn't. A friend of mine's wife said, oh, no, no, Warren, you're wrong. It's going way higher. And then I had another buddy of mine, I said, remember that 911 Turbo you always wanted to buy? Well, you just made enough money on this to buy that dream 911 Turbo you wanted to buy. Please buy it. He goes, no, no, Warren, it's going way higher. Nobody would believe anything I had to say. The greed at the time was just off the charts. So much money at stake and so much money to be made and so many dreams that people couldn't let go of because they all believed that they had an investment that would set them up for the rest of their lives.
- [18:02]
Suzanne Wilton
Knowing the importance of getting an independent third party to verify whether Freeport's findings were accurate, Brian Coates turned to Strathcona Mineral Services. Graham Farquharson and chief geologist Henrik Thalenhorst were assigned. I met up with henrik in Canada.
- [18:23]
Jim Bob Moffett
Dr. Death, that was me specifically how.
- [18:29]
Suzanne Wilton
Did you earn that nickname?
- [18:30]
Jim Bob Moffett
I told the way I saw it, I didn't believe necessarily everything that was told to me. You see, as a geologist, you learn something very early on and that is you don't fool nature, you only fool people. Nature comes back at you. If you don't get it right, it kicks you in the shin or somewhere.
- [18:53]
Suzanne Wilton
Else.
- [18:59]
Jim Bob Moffett
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- [20:28]
Suzanne Wilton
I'm zing Sing. And I'm Simon Jack. And together we host Good Bad Billionaire, the podcast exploring the lives of some of the world's richest people. In the new season, we're setting our sights on some big names. Yep, Lebron James and Martha Stewart to name just a few. And as always, Simon and I are trying to decide whether we think they're good, bad or just another billionaire. That's Good Bad Billionaire from the BBC World Service. Listen now, wherever you get your BBC podcasts, Graham Farquharson and Hendrik Thallenhorst first stop in their Independent investigation before reaching Busang was Jakarta. There, Freeport handed over their results. They were finally able to share what they had been keeping from the world. The samples had been salted. Graham Farquharson immediately got on the phone to the vice president of BRE X, Brian Coates.
- [21:35]
Jim Bob Moffett
I can tell you that Graham Farquharson, when he made the call at 4:00 in the morning out of Indonesia, said, I don't want this stock to trade. I don't want a grandmother buying this stock. But he says, this thing looks dead to me.
- [21:50]
Suzanne Wilton
Farquharson and Dalenhorst followed up with a.
- [21:53]
Jim Bob Moffett
Letter an independent that there appears to be a strong possibility, and these are Graham's words, that the potential gold resources on the Busang project in East Kalimantan, Indonesia, have been overstated because of invalid samples and essaying of those samples.
- [22:09]
Suzanne Wilton
BRE X then issued a press release quoting Graeme Farquharson. BRE X now knew the core samples had been tampered with, but continued to hope there might still be a sizable deposit. There was still suspicion that Freeport could be downplaying the goal to make it cheaper for them to acquire the site. But Farquharson and Thalenhorst were not as hopeful and had a further message for BRE X.
- [22:39]
Jim Bob Moffett
It's obvious to anybody in that business what you had to do, which was halt the trades, protect the widows and orphans, people that you've talked to in Alberta.
- [22:51]
Suzanne Wilton
Brie X agreed and battled with the Toronto Stock Exchange to shut down all trading on BRE X stocks to give Farquharson and Thalenhorst time to assess Freeport's findings. BRE X's vice president, Brian Coates.
- [23:07]
Jim Bob Moffett
You know, we were saying, geez, we got it. We're trying to figure out what's going on here. So maybe we should not open up and trade. The stock exchange wanted to open up and trade.
- [23:19]
Suzanne Wilton
Why did you want the stock to remain halted?
- [23:22]
Jim Bob Moffett
What was the concern Again, I consider myself a good person or wants to do the right things and so on and so forth. So if we're missing information, why should I let my mother buy stock? I don't want my mother buying stock or my sister or any other people.
- [23:42]
Suzanne Wilton
Your sister did buy stock?
- [23:44]
Jim Bob Moffett
My sister did buy stock. But I mean, during that whole point was that you don't want anybody doing it until we got the facts.
- [23:52]
Suzanne Wilton
Graham Farquharson and Henrik Thalenhorst, two men with no axe to grind, were saying they were sufficiently worried there might be no gold in Busang. That trading on Brex shares should be halted until they could find out for sure. But people didn't want to believe what they were hearing. They didn't want to stop trading. They still wanted to believe there was still some gold in Busang.
- [24:23]
Jim Bob Moffett
So the period from March 18 to the delivery of the report in early May was quite a challenging period. But it was full of roller coasters because, again, we were waiting for the results. If you look at the charts, the volume of shares traded of BRE X were higher than the shares traded of BRE X before.
- [24:55]
Suzanne Wilton
Really.
- [24:56]
Jim Bob Moffett
So, you know, everybody was buying the shares and the population of investors was much more diversified. And later I had the opportunity to meet people that said, oh, I bought shares after de Guzman fell out of the helicopter. And why would people do that? Why would you do that? And he says, I buy lottery tickets, too. So again, the people had a doubt on the government of Indonesia. The people had a doubt on the corporate world. The people had. The people wanted, you know, they still.
- [25:37]
Suzanne Wilton
Wanted it to win.
- [25:38]
Jim Bob Moffett
They wanted to win and they felt very intense degree behind it. Also, people were willing to roll the dice at any cost.
- [25:53]
Suzanne Wilton
When the Toronto Stock Exchange ignored BRE X's plea and opened for trading, brex's CEO, David Walsh immediately got on the phone to the exchange's president, Roland Fleming.
- [26:09]
Jim Bob Moffett
Walsh phoned me the foulest, most aggressive phone call I think I received in all my days at the exchange.
- [26:19]
Suzanne Wilton
What did he say?
- [26:21]
Jim Bob Moffett
He wanted us to keep the market closed.
- [26:24]
Suzanne Wilton
Why?
- [26:25]
Jim Bob Moffett
Because he knew more than he was telling us anyway. He wanted us to keep the market closed. I said, that's not our job. Our job is to make it, allow it to happen. If there's more buyers and sellers, that's the market. And I said, do you have any hard information that would cause us to keep the market low? And he said, no. I said, well, it's going to open. I think it was 10 million shares trading hands.
- [26:56]
Suzanne Wilton
And these are individual investors or are these big brokerage houses that are doing.
- [27:00]
Jim Bob Moffett
Oh, across the board.
- [27:02]
Suzanne Wilton
Okay.
- [27:03]
Jim Bob Moffett
The system crashed.
- [27:05]
Suzanne Wilton
It actually crashed, yeah. On the volume of trading in one day?
- [27:10]
Jim Bob Moffett
Yeah, the trade, their trading represented 90% of the volume in all the stocks on that particular day.
- [27:20]
Suzanne Wilton
So what does that usually mean? What does that signal to you when that's happening?
- [27:25]
Jim Bob Moffett
Somebody knows more than we know.
- [27:27]
Suzanne Wilton
Was it unusual for the head of a company of a listed company to call you up?
- [27:33]
Jim Bob Moffett
Yes.
- [27:41]
Suzanne Wilton
Walsh chose not to mention to Fleming Freeport's findings that the samples had been salted.
- [27:48]
Jim Bob Moffett
I just missed it. It was very Aggressive. But I shared the substance of the conversation with my group.
- [27:58]
Suzanne Wilton
As this volatility is occurring and you're concerned, were you watching what was happening with the brokerages and some of the analysts that were covering this company?
- [28:09]
Jim Bob Moffett
They were all gung ho. The exchange was owned by the brokerage brokers, the big firms.
- [28:21]
Suzanne Wilton
By deciding to reopen the market, Roland Fleming allowed traders whether they believed there was gold at Busang or not, to make millions shorting the stock. Shorting is basically a bet that a stock price will fall and if it does, the short delivers a win. Vice president of BRE X Brian Coates.
- [28:46]
Jim Bob Moffett
A lot of fancy sports car were purchased post the helicopter incident. There's a lot of people made a lot of money during that period.
- [28:57]
Suzanne Wilton
Shorting the stock.
- [28:58]
Jim Bob Moffett
Shorting the stock.
- [29:00]
Suzanne Wilton
The mania and the greed was contagious. Even people usually immune to the allure of gold could feel themselves being swayed by the promise of a quick buck. Henrik Dallinhorst.
- [29:15]
Jim Bob Moffett
You know, we're all human. So at one point in time I knew exactly what was happening. Of course, I was insider. I very briefly considered shorting the stock because it came back at five bucks or something and said, okay, I can short a million shares, I can make $5 million. Did I do it?
- [29:37]
Suzanne Wilton
No.
- [29:39]
Jim Bob Moffett
But the thought crossed my mind.
- [29:41]
Suzanne Wilton
Obviously you as the most credible, truthful. Why?
- [29:49]
Jim Bob Moffett
Why not?
- [29:51]
Suzanne Wilton
What does that say? Do you think about the people who were doing that or investing or promoting or what does that say about.
- [29:58]
Jim Bob Moffett
We're all supposed to be honest, aren't we? We can have bad ideas, but we shouldn't act on them.
- [30:04]
Suzanne Wilton
So what stopped you?
- [30:06]
Jim Bob Moffett
Well, you don't do things like that. It's not right.
- [30:14]
Suzanne Wilton
Gold fever retained its grip and many investors clung to their stock. New investors took a chance on buying into the stock in the hope that Farquharson and Thalenhorst would find that there really was gold in Busang. Nothing seemed to be able to kill off gold fever. That was until 4 May 1997, six weeks after De Guzman reportedly jumped from the helicopter and five weeks since Andrew Neal had first raised the possibility that something was seriously amiss at Busang. This was the day of reckoning for BRE X. Graham Farquharson, Henrik Thalenhorst and several copies of a 2 inch thick file were on their way to the boardroom at BRE X's head office in Calgary. This was the day Brian Coates and the rest of the world, including those clinging to bre, had been waiting for BRE X geologist John Felderhoff. Attended on the phone from the Cayman Islands. BRE X's Judgment Day.
- [31:38]
Jim Bob Moffett
So there was lots of people around the boardroom. Mr. Felderhoff was not, but he attended on the phone.
- [31:45]
Suzanne Wilton
What was the mood?
- [31:46]
Jim Bob Moffett
So the mood was again, everybody had the expectation that it wasn't zero. Was it 100 or was it 70? Somewhere in between.
- [32:00]
Suzanne Wilton
Even at this late stage, many of the board believed or perhaps hoped that there was some kind of gold deposit at Busang, maybe even just a modest sized one. What was the mood in the boardroom?
- [32:16]
Jim Bob Moffett
Expectations. Nervous expectations. Graham arrived with two hockey bags and put them on the table. And he says, I'm going for a walk. I'll let you read the report and come back and answer your question. And everybody opened up the report. So Graham and I went along the Bow river in Calgary on a beautiful spring morning. The bikes were going, the birds were singing, the leaves were coming out. It was just wonderful. So we were at least two hours. It left them to their own devices.
- [32:54]
Suzanne Wilton
Henrik Thalenhorst and Graham Varkason made their way back to the BRE X boardroom.
- [33:00]
Jim Bob Moffett
It may have been 11 o'clock by the time we got there. It was a quiet room. It was a very quiet room. The report was pretty devastating. You know, if you look at his introductory report, we very much regret having to express the firm opinion that an economic gold deposit has not been identified in the southeast zone of the Busang property and is unlikely to be. We realize that the conclusions reached in this interim report will be a great disappointment to the many investors, employees, suppliers and the joint venture partners associated with BRE X, to the government of Indonesia and to the mining industry everywhere. However, the magnitude of the tampering with core samples that we believe has occurred and resulting falsification of assay values at Busang is of a scale and over a period of time and with a precision that to our knowledge is without precedent in the history of mining anywhere in the world. Yours sincerely, Grandfather. Rereading again puts shivers down my spine.
- [34:37]
Suzanne Wilton
I can hear the pain in your voice.
- [34:40]
Jim Bob Moffett
So that was pretty amazing.
- [34:43]
Suzanne Wilton
How does that make you feel reading that again, even 25 years later?
- [34:48]
Jim Bob Moffett
It's an awful feeling. It's an awful feeling of. Of tragic moment and brings back all sort of memories.
- [35:02]
Suzanne Wilton
What was it like in that room in that moment?
- [35:09]
Jim Bob Moffett
Lots of anger, surprise, not very much discussion. People heading for the doors. People left, People left. People said, well, I gotta go to the airport now. Visors saying, we're over here.
- [35:33]
Suzanne Wilton
So that must have felt incredibly lonely in that Moment it was.
- [35:44]
Jim Bob Moffett
Feldorf got on the phone and he couldn't believe it, and he rambled on and it just shut. Shut my ears off.
- [35:52]
Suzanne Wilton
What was David Walsh's demeanor during this meeting?
- [35:56]
Jim Bob Moffett
I think he took it reasonably well. I mean, he knew what was coming. He had been pre warned, at least. Yes. This was just sort of the nail.
- [36:05]
Suzanne Wilton
In the coffin, so to speak, as it were.
- [36:07]
Jim Bob Moffett
Yeah, final nail in the coffin. And at the same time, while all of this is happening, you got to remember that that report was delivered in our boardroom, but at the same time was delivered to the securities Commission in Toronto, the osc, and was tagged into, which was tagged in with the Montreal Stock Exchange, you know, the Alberta Stock Exchange. So all of this was being done simultaneously.
- [36:41]
Suzanne Wilton
It was about to blow up. You'd gone from being a hero.
- [36:47]
Jim Bob Moffett
Hero to zero. You know, being asked by the Toronto Stock Exchange if we had anything to say, our answer was no. They went out, deliberated, and then came back and said, you're delisted.
- [37:03]
Suzanne Wilton
Just that quickly? Just like that.
- [37:05]
Jim Bob Moffett
Okay, thanks. I then took the flight to Montreal. As I look up, this was just in the time where the news. They were starting to show news on airplanes. And I look up and there's a picture of me coming out in my van coming out of the BRE X building. You're on a plane, everybody has seen you come down the aisle, and then they see you on the airport. Not exactly a great feeling. Cracked an unfortunate joke with the stewardess when I said, I'll buy you the drink. And I asked her if she took Indonesian money, and she said, no, and I don't take their gold either. Ouch. So, you know, it was game on.
- [37:59]
Suzanne Wilton
This was the end of the dream for BRE X and the many investors who'd held on to BRE X shares. The amount of gold wasn't just exaggerated. It didn't exist. The whole thing was a scam. Entire pension funds were wiped out. 6 billion was reduced to zero. But who'd salted the samples? Had de Guzman done this all by himself? Or were there larger forces at play? In the next episode of the $6 billion gold scam, the fallout from BRE X begins. We lost everything.
- [38:55]
Jim Bob Moffett
My husband was sick for four years.
- [38:57]
Suzanne Wilton
We worked hard for our money, and investors go looking for someone to blame.
- [39:03]
Jim Bob Moffett
It was said that he should have known that the numbers they were reporting were inaccurate.
- [39:09]
Suzanne Wilton
And I tried track down an eyewitness who claims he saw what was really going on at Busang.
- [39:16]
Jim Bob Moffett
There were local gold panners around. They bought a bit of gold and they worked out this very sophisticated system of salting the core.
- [39:32]
Suzanne Wilton
The $6 billion gold scam is produced by BBC Scotland Productions for the BBC World Service and CBC. Susan I'm Suzanne Wilton. Our lead producer is Kate Bissell Producers Anna Miles, Mark Rickards story consultant Jack Kibble White music and sound design by Hannis Brown additional sound design and audio mix by Joel Cox Executive editor Heather Kane Darling at cbc, Veronica Simmons and Willow Smith are senior producers, Chris Oak is executive producer, Cecil Fernandez is executive producer and Arif Noorani is the director at the BBC World Service, Ann Dixie is senior podcast producer and John Manell is the podcast commissioning editor. Thanks for listening. For some of us, personal finances aren't just personal.
- [40:52]
Jim Bob Moffett
They include a lot more people than ourselves, loved ones, neighbors, the community we call home, and the causes we hold in our hearts.
- [41:01]
Suzanne Wilton
At Thrivent, we help plan your financial picture with the bigger picture in mind.
- [41:06]
Jim Bob Moffett
Because even though our business is helping.
- [41:08]
Suzanne Wilton
Guide your finances, our ambition is to make it mean so much more. Thrivent where money means more Connect with us@thrivent.com.