Golden Star Resources Ltd. (GSS) Accused of Misleading Shareholders
According to the complaint for alleged violations of the Securities Exchange Act of 1934 between February 20, 2019 and July 30, 2019, in February 2019, Golden Star Resources Ltd. (GSS) claimed it was seeing “tremendous improvement” in operational metrics and performance of the Prestea mine and that “blasting” issues had been rectified. Following these positive representations, Golden Star continuously provided optimistic guidance on the Company’s production goals, the quality and grade of that production, as well as the cost per ounce of that production for both Prestea and Wassa throughout the relevant period. Contrary to Golden Star’s representations, on July 31, 2019, Golden Star released disappointing second quarter financial results, disclosing a cut to the Company’s production guidance and an increase in its cash operating cost estimates. Golden Star cited a laundry list of issues for its poor financial performance, including the use of insufficient geological and geotechnical data and poor drilling strategies and techniques. On this news, Golden Star’s stock price fell 17% to close at $3.55.