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Wednesday, March 12, 2014

MONEY UNDER THE MATTRESS? Battle Creek's "Crooked Chiropractor" Robert Buckhannon And His Secret Colorado Gold Mine

Miss Fortune has discovered herself a gold mine...of information!

Buried deep within the files of Colorado's Gilpin County Assessor's Office is a clutch of documents that detail a trail of transactions apparently leading to Battle Creek's Robert Buckhannon (wonder if I should still say "Battle Creek" any more, since I've heard the rumors that he's flown back to the bright lights of Las Vegas).

And since we're talking about Robert Buckhannon, this tale wouldn't be complete without the requisite disbarred attorney—in this case, that's Parker, Colorado's Michael S. Edgington.


Miss Fortune wonders if that killer AC/DC tune was playing in the background when Buckhannon and his attorney Edgington kicked around names for a new shell corporation during the summer of 2009. And even though it was Brian Johnson (and not the late, great Bon Scott) singing lead, "TNT" came out the winner.

Well, I can't say that I really know what was playing in the background and where it was playing, but publicly available records show that Edgington, using Buckhannon's Las Vegas home address1017 Windfair Village Street—as the corporation's address, registered an entity in Colorado on August 27, 2009.

Naming the new company "TAnnT Mining & Milling, LLC", Edgington listed himself as the 'Registered Agent' and his Parker, Colorado law firm (Edgington Brothers, LLC) as the "true name" of the entity forming the limited liability company.

Miss Fortune was born at night, but definitely not last night! This one sure looks like it may have been created to shield Buckhannon's identity from the prying eyes of Uncle Sugar!

The financial three-card monte continued the very next day (August 28, 2009) in Gilpin County, Colorado, when TAnnT Mining & Milling, LLC plunked down $1.23 million to 19 mining claims on over 118 acres from one Thomas S. Hendricks.

Hendricks, known among the locals as "Miner Tom", had owned and prospected the gold mining property since 1993 when he purchased it for $100,000.

After the property purchase, Edgington neglected TAnnT Mining & Milling, LLC's Colorado corporation records, failing to file any of the required updates between August 27, 2009 and April 14, 2011—one day before his disbarment was announced. 

Edgington submitted a "statement curing delinquency", effectively reviving the company on April 14, 2011.

The company lapsed back into "delinquency" on September 1, 2012.

On November 2, 2011, about four months after Buckhannon filed for bankruptcy in Nevada, Hendricks got the deeds to the 19 claims back after a foreclosure.

"Miner Tom" Hendricks resold the claims on August 28, 2012 (the fourth anniversary of the original "TAnnT" sale), to Lost Creek Gold Mine LLC and reporting a $200,000 sale amount.


So what's up with Thomas S. Hendricks these days?

The ambitious plans of Hendricks and his partners to recover the gold in the hills above Nederland, Colorado, have been stymied after lawsuits filed by an investment group headed by former Colorado state Sen. Tom Wiens.

Wiens is attempting to foreclose on the Boulder County mining properties, claiming that Hendricks and partners in Calais Resources Inc. defaulted on $15 million in loans.

Calais Resources was created as a publicly owned company, but in 2012 the Securities and Exchange Commission revoked the firm's registration for a recurring pattern of failing to file financial reports. Calais told regulators that the reports weren't filed because the company couldn't afford to pay its auditor.

An apparent breakthrough occurred later in 2012 when a group that included Wiens spent $6 million to purchase promissory notes representing loans made to Calais over the past decade. The notes gave the Wiens group the right to collect principal and interest payments from Calais.

Wiens, 61, served as a Republican state legislator in Colorado from 2003 to 2009. He owns a Douglas County ranch and operates a financial-services firm, New West Capital. Wiens saw the Calais promissory notes not just as a financial instrument but as a mechanism to get involved in the quest for gold.

He and the mine partners launched a series of discussions about creating a partnership in which Wiens' group would provide the funds needed to get the mines up and running again.

Calais says Wiens agreed to make an initial payment of $930,000 to pay off some of Calais' debts, then invest more to make the mines operational.

Months later, the talks turned confrontational under claims by both sides of fraud and misdealing. The court cases continue. 

Following a sanctions hearing, Colorado attorney Michael S. Edgington, the attorney who represented Buckhannon during his negotiations with the SEC, was disbarred, effective April 15, 2011.

Hearing records state that the "respondent (Edgington) failed to communicate with his client and failed to perform work on his client's behalf, effectively abandoning his client." In addition, Edgington told his client that he had drafted, filed, and served a complaint and sent certain correspondence when, in fact, he had never completed those tasks. He billed his client $5,165.25 for work he never completed.


While Buckhannon's name does not appear any where in the incorporation documents or the warranty deed, guess whose name appears on "Exhibit C", a Reserved Production Royalty agreement? 

Frank Dasaro, who identified himself as "Managing Member" of TAnnT Mining & Milling, LLC.

Dasaro, with Chris Boll and Richard Mittasch, formed Global Commodities Group (a Delaware corporation) and along with Robert Buckhannon, were to receive "employment contracts" to manage another Buckhannon entity, Nevada corporation Shea Mining & Milling, LLC.

Buckhannon formed Shea Mining & Milling in the British Virgin Islands, then "sold" the company to Boll while remaining a not-so-silent partner per his "employment contract".

In its complaint, the SEC alleged Buckhannon was involved in the deal to steer $6 million in investor money to Shea Mining and Milling LLC for a project called the "Tonopah Mine.'' 
Buckhannon, however, didn't disclose he had a conflict of interest because he was a founder of Shea Mining and planned to enter into an employment contract with Shea and receive a share of the firm's revenue.

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