The Securities and Exchange Commission on Thursday settled charges filed against a California mining company and its chief executive for operating a fraudulent Nevada gold mining venture that raised $16 million from investors.
The SEC alleged Nekekim Corp. and its CEO Kenneth Carlton defrauded investors with claims that a special “complex ore” found at its mine near Tonopah contained gold deposits worth at least $1.7 billion.
Carlton highlighted test results produced by two small labs that used unconventional methods to test the ore for gold, but he withheld from investors other tests conducted by other labs that suggested the Nekekim mine site held little if any gold.
Carlton, who lives in Clovis, Calif., agreed to settle the SEC’s charges. He agreed to pay a $50,000 penalty and is prohibited from selling securities for Nekekim or managing the company.
Madera, Calif.-based Nekekim agreed to an order requiring disclosure of these sanctions in any offering of securities for the next three years. Carlton and Nekekim neither admitted nor denied the SEC’s allegations.
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