LETTERS TO THE EDITOR — Bishop responds to accusations

In a recent letter (“Industry needs dose of credibility,” T.N.M., June 29-July 5, 1998), Daniel MacAlpine writes, “When Bob Bishop blamed the Crystallex loss on the crooked Venezuelan courts, he shirked his own responsibility to do the necessary geological, financial and legal research before recommending the stock.”

When, I ask Mr. MacAlpine, did I ever suggest that the Veneuelan Supreme Court was bribed? On June 10, I did report on the rumor sweeping the market that the Court had been bought off and that the verdict was 4-to-1 in favor of Placer Dome, but I would not make the accusations that Mr. MacAlpine suggests. I have no basis for such accusations, nor have I made them.

If Mr. MacAlpine’s source is Stockwatch, his confusion is understandable.

Since the ruling from the Supreme Court came on June 11, Stockwatch has frequently reported that I made such accusations. Stockwatch’s unnamed reporter and Mr. MacAlpine should check their facts more closely.

The fact is that my observations have been confined to the confidentiality surrounding the workings of the Court and, on that score, the Court is clearly lacking: in two days, between the U.S. and Canadian markets, approximately 4 million Crystallex shares changed hands before the verdict was announced on June 11, a 4-1 decision in favor of Placer Dome. Reporting on a rumor that was driving the market in Crystallex — from $5.95 to $2.20 in the two days preceding the verdict — and making accusations about the court are two entirely different matters. Those who read what I actually said can appreciate this distinction much better than those who are simply listening to others rendering their own interpretations of what I said.

As for the suggestion that more “grunt work” would have resulted in a different conclusion on my part, that presupposes that due diligence could have led to only one conclusion. Large amounts of due diligence were applied to this matter, and many others drew the same conclusions that I did, fully mindful of the risks associated with being wrong. Those risks were always represented to be high — Crystallex would be either a $1 or a $20 stock. As for the idea that I sold rides on a kiddie merry-go-round and then put my customers on a roller-coaster again misrepresents my position.

Betting on the outcome of a legal dispute in a foreign country was represented as, and always will be, a high-risk proposition. In fact, I frequently used the term “roller-coaster” to describe Crystallex. As investors should know, or soon will be reminded, kiddie merry-go-rounds and mining stocks are mutually exclusive propositions.

.BRobert Bishop

Editor, Gold Mining Stock Report