Government Leak Probed in Irregular Stock Activity

Loose lips in Ottawa may have caused a massive sell-off of shares in Taseko Mines Ltd.

On Nov. 2, Environment Minister Jim Prentice scuttled a proposal from Taseko to build the Prosperity Mine in a pristine wilderness area in B.C., saying it would cause too much environmental damage. But 19 days before the government announced its decision, a massive sell-off of Taseko shares occurred on U.S. and Canadian markets, prompting speculation that news of Prentice’s impending rejection was leaked to investors. At one point on Oct. 14, investors sold off 2.7 million shares in 40 seconds, sending Taseko stock into freefall. Canadian securities investigators have now launched a probe into the government’s review process, which although conducted under secrecy, involved several departments including natural resources, fisheries and environment, as well as the prime minister's office.