Strategic Minerals PLC (LON:SML) has named the client it is suing for lost earnings and damages as CV Investments, a company whose owner has been charged in the US for running a ponzi scheme.
The metals junior was recently awarded US$21.9mln in damages and costs against CV and its principal Brenda Smith.
In a statement, SMG said it only became aware that the assets of CV Investments had been frozen by the US Securities and Exchange Commission (SEC) and that Brenda Smith had been charged for running a Ponzi scheme in relation to her mutual funds operations when it made a claim for missed payments in 2019.
“Throughout the process, SMG and the board of Strategic Minerals have undertaken their fiduciary duties and acted in the best interests of shareholders to maximise the residual value of the contract.
“Accordingly, it has kept the market informed to the extent permitted by its legal advice.
“It is noted that, while the company has not been able to disclose the contract counterparty, it has cautioned the market on what assets, if any, would be capable of being recouped from the Client.
“Even now there is no clarity on the amount or timing SMG may expect associated with the SEC's request for the appointment of a receiver.”
John Peters, Strategic Minerals managing director, said: "CV Investments has caused the company considerable angst but has also contributed meaningful funds.
“While the Board has been restrained until now in naming the counterparty, it should be noted that they have full confidence in the value of the company and have continued to invest in the company's shares throughout this period. "