Saturday, 25 May 2013

Scam of the 1960's - Gold Mine Preference Shares

I found some old documents in the back of the drawer and learnt that my father had ventured into the uncharted territory - stocks, in 1961.

He had invested into a gold mine preference shares scheme.  Unfortunately, that was an expensive and painful lesson as he was scammed by a friend of the boss.

Sometime in 1961, the boss's friend visited his factory and sweet-talked the workers into investing into a gold mine in Mersing, Johore.  The workers were told that the gold mine had huge deposit of gold and the owner of the gold mine was looking for investment money in order to start extracting gold from the mine. 

After the gold mine started operation, the owner would list his gold mine on the stock exchange.  The workers who invested into the preference shares would exchange into the shares cheaply.  The company (gold mine) would also pay huge dividends every year.

My father's pay was $50 a month back in 1961.  The investment amount of $250 was five month's pay.  A lot of workers, including the boss, had invested into this gold mine preference shares scheme.

Unfortunately this was a scam, and the boss's friend, after collecting the money, disappeared into an unknown hell-hole.

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