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U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 18594 / February 25, 2004

S.E.C. v. American Gold Mining Corp. and Ronald V. Markham, Docket No. 2:04 CV-0190 JTG (U.S.D.C., D. Utah)

On February 23, 2004, a complaint was filed in the United States District Court for the District of Utah, seeking permanent injunctions against American Gold Mining Corp. ("American Gold") and Ronald V. Markham ("Markham") and seeking disgorgement, civil money penalties and an officer/director bar against Markham.

The complaint alleges that American Gold and Markham, its president and CEO, fraudulently sold approximately $7 million of American Gold's common stock to approximately 140 investors in unregistered transactions. Markham located and solicited investors personally, through intermediaries, and by causing favorable magazine articles to be published about American Gold and having these articles appear on the magazine's Internet web site.

It is further alleged that through both a private placement memorandum and oral presentations, Markham made material misrepresentations regarding, among other things: the amounts of gold and platinum ore in mining claims leased by American Gold; the viability of an extraction process developed by American Gold to recover precious metals; and how investor funds would be used by American Gold to develop its mining property. It is also alleged that Markham promised large returns on investments in American Gold and that he misappropriated at least $3.4 million of the invested funds for his personal living expenses.

The complaint alleges that by engaging in such conduct American Gold and Markham have violated Sections 5(a), 5(c) and 17 (a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.


http://www.sec.gov/litigation/litreleases/lr18594.htm


Modified: 02/25/2004