Ever heard of the British Columbia Securities Commission? These guys mean business; there is no question about it. You obviously have no idea who BCSC are. Otherwise, you would not be looking for additional information about Sterling Group Ventures (OTC:SGGV). Allow me to reveal to you several facts of particular interest regarding this company, one step at a time. So we can start with what happened recently on the market.
At first glance, it seems that this is the year of Sterling Group. Plans about projects in China soon to commence are coming by the hour, good news about secured financing are also not uncommon. As a result, we have a 52-week high in volume yesterday, together with more than 80% increase in the price in just one session. Sounds good doesn`t it! Yet, the more you dig in, the worse the information gets.
Financials, for starters – they don`t exactly inspire confidence. This is nothing, however, compared to what comes next – the management. What we have on the top of the Sterling management pyramid is Raoul Tsakok. A short glance at the company website would tell us that he has over 30 years of experience in the Investment Management business, serving as a chairman and senior executive in different enterprises. A short glance at the news back in 2006 would tell us that the B.C. Securities Commission sanctioned him as one of Canada`s worst-performing mutual fund managers for taking undue risks with investors` money.
Don`t worry though, everything was settled eventually. Mr.Tsakok just has a lifetime ban from acting as an advising director or trading officer of a mutual fund or registered securities dealer. He also agreed to pay a $40 thousand penalty. Not such a great amount, given that under the administration of his company back then the assets of the mutual funds declined from $238 million in 1994 to $11 million in 2002. Fortunately, a loss of $220 million does not mean he cannot run another company and list it on the stock market for people to buy its shares.
The above also does not constitute as a proof that the unfortunate experience of Tsakok would also doom Sterling Group to fail. After all, this is still a development-stage mining company. It focuses operations in an industry, which some people consider being highly lucrative. [BANNER]
Yet, caution should be applied when considering Sterling as an investment. When a company is led by a person with a permanent ban to advise on how millions are spent, it is wise to check first what you have in your wallet, then check what you are willing to risk, and most important – if an investment is a risk or pure inadequacy to take smart decisions.
