Anyone who invests in an exploration co knows it can go wrong...

Anyone who invests in an exploration co knows it can go wrong and I am willing to acknowledge that I made a mistake on this one. However, I am beating myself up less on this than I have on other mistakes because for several reasons I thought CSD set itself apart from other exploration punts.

First, I liked the way senior managers and directors put in big chunks of their own money. There are so many life style cos on the ASX which simply consume the proceeds from CR's without producing anything, finding anything, or even really doing anything, that it was refreshing to find one where directors were willing to dig into their own pockets to keep things moving.

Second, I liked the state of the exploration. A proven resource, with a PFS, should be a better bet than an exploration co kicking dirt and occasionally finding a few grains of something on the surface.

Thirdly, I liked the proximity of infrastructure and a plant. The costs and risks of an investment are much higher if everything has to be built from scratch.

Finally I liked the attempt to secure cash flow from existing producing assets. An exploration co with a cash flow is usually a better bet than one which has to pass the cap around to complete every stage of proving something up. Shares of such cos are often valued on the cash flow alone, making the exploration project a pure bonus if it comes good.

So what went wrong?

I don't think the founding directors would deliberately cheat on the original shareholders, because they were shareholders. However, if some party to the failed settlement negotiations stood to gain from their failing, and if they deliberately contributed to failure of the negotiations in order to bring about such gain, then in my opinion that would amount to fraud. In that case such parties should be prosecuted under Australian Law and/or sued by the minority shareholders who lost out.

The CSD thread is not quite like some others on HC. There are quite a few posters with largish holdings, and quite a few who seem to have larger brains than many on some threads. Is there anyone else out there who thinks we might have been deliberately cheated, not by the founding directors, but by someone lurking in the shadows?