Silvercorp Responds to Second Anonymous Allegation and Provides Government Certification of Taxes Paid
VANCOUVER, BRITISH COLUMBIA--(Marketwire -09/14/11)- Silvercorp Metals Inc. ("Silvercorp" or the "Company") (TSX: SVM.TO - News)(NYSE: SVM.TO - News) advises that a second set of anonymous allegations against the Company has been made, which was published on the internet (the "2nd Anonymous Report"). The Company refutes the substance of all allegations in the 2nd Anonymous Report, and believes it has been published in furtherance of concerted efforts by a group of short sellers to drive down the Company's share price through false, selective or ignorant statements and rumors. Investigations are ongoing by the RCMP, the BC Securities Commission, the SEC and the FBI to determine the identity of the anonymous authors.
Translation: Silvercorp advises anyone living under a rock that a second set of allegations has been made, and while you can find the report right on teh intarwebz we'll still call the second guy "anonymous". The RCMP, BCSC, SEC and FBI can find Alfred Little in 5 minutes, and when they get there we hope they don't ask about any of the substance of his allegations, like how we aren't hauling as much ore as we say we do and the ore was sampled to be low grade. Because holy crap, this could come back and bite us real quick.
Dr. Rui Feng, Chairman stated, "Over the course of the last five years, Silvercorp has developed and commenced profitable mining from its Ying Mining Camp. Revenues from operations have resulted in Silvercorp's operating subsidiaries having paid over US$116.6 million in taxes to the Chinese government, as evidenced by the Tax Certificates issued by Chinese government, and total dividends of US$152 million to its shareholders. These reflect a total revenue stream that is in accordance with the mine production and sales revenues reported by the Company during that period.
Translation: Chairman Dr. Rui Feng says his company must be making money, because he has statements on paper that vaguely suggest so.
"I ask shareholders to exercise common sense in assessing whether these allegations of "fraud" against the Company have any merit whatsoever in the face of very significant revenues, tax payments and dividends, and particularly when the accusations are made anonymously by parties whose only interest is in depressing the Company's share price. I invite the authors of the anonymous allegations to come out of the shadows and participate with the regulators in their investigations, if their concerns truly extend beyond the profitability of their short positions."
Translation: there is a shadowy conspiracy. Perhaps the Lizard People are involved. Also, note that I'm a Chinese male in a position of power: that means that I can do no wrong, though secretly it really only means I can never admit that I am wrong.
The Independent Committee, in keeping with its duty, has retained independent legal counsel to examine the anonymous allegations. In addition, KPMG Forensic Inc. was engaged on September 6th by legal counsel to the Independent Committee to assist the Independent Committee by completing a report on certain aspects of revenue, cash balances and income tax and VAT payments in China, and to perform certain reconciliations of the Company's filings in China with those filed with North American regulators. The Independent Committee will report further on its findings and respond to the allegations in the 2nd Anonymous Report in due course.
Translation: The Independent Committee can't read Mandarin and won't inspect the ore, and count the trucks, the way Alfred Little did. We made sure of that. So don't expect much.