Gold Basin Resources (TSXV: GXX; US-OTC: GXXFF), a junior explorer where… Kanex Metal (TSXV:CANX) reasserted control of President and Interim CEO Charles Straw last month, alleging serious misconduct that caused a financial loss and violation of exchange rules.
The dispute is related to Canex’s acquisition of Gold Basin which was launched in February after a spin-off in 2020. The latest move allowed Canex to appoint a new board of directors at the shareholders meeting on March 16 to put things in order at Gold Basin, whose shares are TSXV I stopped trading Last May for not submitting financial results. Straw maintains he was the victim of online fraud.
“Gold Basin has terminated Charles Straw for cause,” the company said in a statement. March 25 release. “What Mr Straw does not explain is why he transferred large sums of money from Gold Basin’s bank account to a private account which he controlled before he ‘fell victim’ to the internet fraud.”
Straw says he lost less than $50,000 after his email was hacked in 2024, that his bank covered $15,000 of the loss, and that the new board is retaliating after it did not support a plan to get shareholder support for the takeover. He says he reported the alleged coercion to the British Columbia securities regulator.
“The previous board, officers and legal counsel were aware that I was the victim of an Internet scam, not the perpetrator of the fraud,” he wrote in an email this month to Northern Miner Group. Canadian Mining Journal. Straw said that these accusations “constitute a pattern of behavior and rumour-mongering to discredit me.”
Emerging risks
The company confirmed that its findings were not proven by the court and that its investigations are continuing. The situation highlights governance risks, fraud among junior explorers and significant risks for gold projects at benchmark bullion prices. Investor forums can be found online describing Gold Basin’s recent history, its loans, its joint venture with Helix Resources (ASX:HLX) and previous allegations.
Gold Basin and Helix were also named as defendants in a petition filed by shareholders on October 28 in the Supreme Court of British Columbia, according to Canex detection. Canex says Gold Basin failed to respond to the petition by the court’s deadline and disclose the existence of the petition to shareholders.
Gold Basin, a Vancouver-based exploration company, owns the 42-square-kilometre Gold Basin project in Mohave County, Arizona, about 300 kilometers northwest of Phoenix. The project hosts near-surface oxide gold mining and contains more than 800 historical and current drill holes in deposits up to 1.7 km long. There was no resource deposited into the project.
Canex holds the claims surrounding the Gold Basin project, giving it exposure to the broader region outside of the core oxide zones held by Gold Basin Resources.
The Gold Basin area dates back to the 1870s, but saw only small clay and siltstone production, leaving a largely underdeveloped gold system that modern explorers are now reevaluating as a large-scale oxide play.
Straw was appointed President of Gold Basin in 2021. He is an economic geologist with more than 20 years of mining experience and has held executive and director positions at junior explorers, including a director position at Volcanic Gold Mines (TSXV: VG; US-OTC: VLMZF).
Internal investigation
Gold Basin’s board summary of its investigation alleges “conversion for personal use and loss of company funds; misappropriation of corporate opportunities; causing the company to enter into transactions with parties in which Mr. Straw or his associates had a personal interest on financial and business terms that were not fair or reasonable to the company,” violations of the Canadian Securities Act, the British Columbia Business Corporations Act, the Stock Exchange Rules and a court restraining order.
Gold Basin said it sent Straw a termination letter on March 16 that listed 15 violations. The new board said it had not been provided with documents explaining why “large sums of money” were transferred from the company account to a private account that Straw controlled before the alleged fraud.
Shane Ebert, Gold Basin’s new CEO, said in an email this month to Canadian Mining Journal. Ebert said Straw “failed to provide the company with details, financial records or a reasonable explanation.” He noted that the statement “did not directly state that Mr. Straw had stolen money,” but that Straw had “transferred large sums of money… into a private account that he controlled.”
A spokesperson for the British Columbia Securities Commission declined to comment, noting that confidentiality rules prevent it from saying whether a company is complying with securities laws, is being investigated, or will be subject to regulatory action.
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