Director of Australian nickel stock arrested

Press, Volume CXI, Issue 32588, 23 April 1971, Page 1

Director of Australian nickel stock arrested

(N.Z. Press Association —Copyright?

SYDNEY, April 22.

. A director of the suspended Australian nickel stock, Leopold Minerals, N.L., which last month announced a very promising nickel assay report which sent its shares soaring, today appeared in court in Sydney charged with having made a false statement.

Brian Howard Cutler, aged 32, appeared in the Central Criminal Court charged with having published a false statement in relation to a nickel assay report issued in Perth on March 19.

The Magistrate, Mr K. Webb, remanded Cutler to appear in the same court tomorrow, pending extradition proceedings to Western Australia. He granted Cutler bail of $4OOO. Cutler was not required to plead. The charge against Cutler alleges that he had con-

curred in making a written statement which was false of a nickel assay report on the first diamond drill hole on Leopold’s claims at Nullagine in the Pilbara region of Western Australia with intent to deceive fellow members of the company contrary to Section 420 of the West Australian criminal code. The section carries a maxi-

mum penalty of seven years gaol. The drill assay report on March 19 claimed that nickel

assaying an average of 533 per cent had been discovered from a core sample from the drill hole.

The nickel assays were the highest for more than five years. Leopold’s shares rose quickly from 40c to $1 on rumours of the report, and

to a peak $B.BO after it was announced.

“LEADING CITIZEN” The police prosecutor, Sergeant F. Gardiner, who opposed bail at today’s hearing, said it would be alleged that “a considerable amount of money was involved in transactions that led to the charge against Cutler.”

Mr K. Murray, for Cutler, said his client was a respected and leading citizen in Western Australia who was now living in Sydney.

Cutler was arrested by police today after weeks of inquiries into the company by police, Stock Exchange investigators, and a Federal Parliamentary committee. The inquiries began almost immediately after the company’s shares, then selling for $5 were suspended on March 25 on Australian Stock Exchanges and in London as the result of a request by Mr Alan Treloar, the company chairman, and another director, Mr Geoffrey Brown.

DRILL HOLE The suspension request was made pending clarification of the procedure adopted in the assaying of cores from the drill hole.

The next day the two directors expressed dissatisfaction with the geological information provided by the company’s geologists, and asked West Australian police to investigate. Mr Cutler, as well as being a director of Leopold, is also chairman of Geodrillers, then the company’s geologists.

At the Federal hearing Mr Treloar said that the assay report was released after only a preliminary examination of the core had been done.

The other director, Mr Brown, said that the core sample referred to in the assay report was missing. The missing sample has not yet been recovered.