Investigators are trying to determine whether a leak of sensitive information from within the federal government prompted a sharp drop in value of the shares of a British Columbia mining company, the CBC is reporting.
Citing unnamed government sources, the broadcaster said Wednesday night that the Investment Regulatory Organization of Canada is trying to determine why shares in Taseko Mines Ltd., fell nearly 40 per cent on Oct. 14, more than two weeks before the federal government announced that it was blocking the firm's plans to develop the Prosperity Mine, a development 125 kilometres southwest of Prince George.
Federal officials fear that the steep drop in stock was caused by a leak of information that the development would be stopped, the broadcaster reported, adding that the decision was taken secretly, in hopes of preventing such stock market fluctuations.
IROC officials phoned the company as soon as they noticed the run on its stock, asking if there was any explanation for the wild trading, prompting Taseko to issue a press release reassuring investors that it could think of no reason for the mass selloff, the CBC reported. This reassurance had its intended effect, causing the stock price to recover.
The Prosperity Mine, a long-planned development, was backed by the province earlier this year. However, in November, the federal government blocked the proposal over an environmental assessment that raised concerns the mine would turn a lake into a dumping ground for mine refuse and could have negative consequences for wildlife in the area.