If I remember right, in the case of Bre-x the company was deliberately adding gold particles to the samples before sending them for assays. The assaying lab should be obliged to check whether the gold is part of the mineral structure, but in the Bre-x case, they immediately conducted the assays and hence were themselves duped into believing the gold was present.
Most of these scams are perpetrated on the stock markets, and they typically follow a simple structure: (1) Reverse takeover or change of business plan (2) Issue a lot of very cheap or free shares (3) Find a rich person to lend the company a few million dollars (4) A couple months later, use the money to launch a stock promotion campaign via internet/email (5) People get sucked in... hype sets in (6) Volume comes in then dump.
Mooter Media (MMZ) is a nice example of the above on the ASX.
The LEXG company is a classic example and very visible to see the scam in action. Early 2011, SEC-filings showing the issue of free shares. The June Quarterly report shows a sudden increase in expenses [from $100k per quarter to $20 mil... subsequent quarters show expenditure of $200k in the financials]. If you read the fine print on the stock promotion material, you'll find the promoter disclosing things like "I was paid $1 million to publish and spread this article". The authorities will eventually get off their backsides and dish out the punishment, the scamster in that case was a n00b and didn't cover his tracks at all! I'm still shaking my head on that one, can't believe it, from 7 CENTS to OVER 10 DOLLARS in two months - A market cap of a couple million to half a billion. SFR barely achieved that feat and they actually found something real.
