Corporation Owned By Chinese Multi-Billionaire Had Net Losses Of $19 Million Over The Last Two Years

HELENA, MT The Trump administration just granted a $365,000 taxpayer-funded bailout from the Paycheck Protection Program (PPP) to General Moly, a foreign mining corporation owned by a Chinese multi-billionaire operating in central Nevada. The corporation has a checkered history that includes $19 million in net losses over the last two years and overseas investors with a history of insider trading and “mafia-style crimes.”

“It’s clear that the lack of robust oversight from the Trump administration coupled with its epic mismanagement of the COVID-19 response is allowing some of the worst and most financially insolvent foreign-owned corporations to exploit American tax dollars,” said Jayson O’Neill, Accountable.US spokesperson. “Imagine if you’re a real small business owner still waiting on needed funds to retain employees and stay afloat but find out the Trump administration just bailed out another foreign mining corporation owned by a Chinese multi-billionaire with investors linked to mafia-style crimes.”

Foreign-owned mining corporation General Moly received a $365,034 taxpayer-funded PPP bailout on April 24th according to SEC filings. According to the corporation’s website, it has an 80% interest in the Mt. Hope Project and owns the Liberty Project mine. Both mines are located in central Nevada and produce molybdenum (moly) and copper.  

Chinese mining corporation AMER International, owned by a Chinese multi-billionaire, controls over 25% of General Moly, making AMER the corporation’s largest shareholder and giving it the right to nominate directors to the corporation’s board. Hanlong Mining, which owns a 5% share of General Moly, has a documented history of insider trading and “mafia-style crimes.”

These filings were compiled as part of an ongoing tracking project by Accountable.US. TrumpBailouts.org documents the billion-dollar corporations and other large companies that have received taxpayer assistance under the CARES Act, and what advantages and assets they had going into the COVID-19 crisis that most small businesses could never access.

According to watchdog group Accountable.US’s tally, the ‘Mining’ sector, which includes oil and gas, has been awarded over $3.9 billion. Senate and House lawmakers introduced new legislation last week that would prohibit the Trump administration from bailing out big oil corporations.

Previously controversial PPP grantees include a foreign-owned uranium mining corporation with ties to the Trump administration, oil corporations that spent millions on stock buybacks, a Indiana-based coal corporation with a former Trump official as its lobbyist, at least two companies that market their ability to ship U.S. manufacturing jobs overseas, major luxury hotel chains, a fashion model agency, and even the L.A. Lakers.  

BACKGROUND: The Small Business Administration’s Paycheck Protection Program has been plagued with reports of legitimate small businesses unable to access the help the President claimed would come in “record time”. They have faced a bureaucratic maze often ending in delays and rejection as banks reportedly prioritized those “with the best relationships — not the neediest or most deserving.” A recent survey of small businesses found only 13% of the 45% who applied for a PPP loan were ever approved, and experts believe that nearly 90% of minority and women small business owners have been shut out of the program. Meanwhile, CEOs of large companies have managed to coast through the process. Well over 300 publicly-traded firms or conflicted companies, some worth more than $100 million, have received over a billion dollars in taxpayer money. It’s no wonder the Trump administration has shied away from transparency in this process.

A Chinese-Owned Mining Corporation Got A Hefty Bailout From The Trump Administration Despite Continued Financial Losses

General Moly Is Owned By A Chinese Multibillionaire And A Chinese Mining Corporation With A History Of “Mafia-Style Crimes.” They Just Got A $365,034 Bailout From The Trump Administration.

General Moly Received $365,034 From The Paycheck Protection Program Designed To Help Small American Business…

On April 24, 2020, General Moly Received $365,034 In Funding From The Paycheck Protection Program. “On April 24, 2020, General Moly, Inc. (the “Company”) received funding under a Paycheck Protection Program (“PPP”) loan (the “PPP Loan”) from U.S. Bank, National Association (the “Lender”). The principal amount of the PPP Loan is $365,034. The PPP was established under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and is administered by the U.S. Small Business Administration (the “SBA”). The Company applied for the PPP Loan primarily because its potential to access other sources of capital has been greatly reduced by the ongoing COVID-19 pandemic.” [SEC EDGAR – General Moly 8-K, 04/29/20]

General Moly Is A Mining Company. “General Moly is the only pure-play, western-exchange traded molybdenum (“moly”) stock. The Company is a U.S.-based moly mineral exploration and development company, primarily focused on molybdenum.” [General Moly, accessed 05/11/20]

…But Chinese Mining Company AMER International, Owned By A Chinese Billionaire, Controls Over 25% Of General Moly…

AMER International Owns 25.6% Of General Moly. AMER International possesses 39,078,590 shares of General Moly, giving it 25.6% ownership of General Moly. [SEC EDGAR – General Moly DEF14A, 04/29/20]

  • On December 9, 2019, AMER International And General Moly Signed A Deal Allowing AMER To Buy Up To 80 Million Shares Of General Moly. “On December 9, 2019, the Company and an affiliate of AMER announced the closure of a $4 million private placement at a price of $0.40 per common share of General Moly under a new Securities Purchase Agreement (“SPA”) and amended and restated warrant agreement for the purchase of up to 80 million shares of common stock at $0.50 per share (“New AMER Warrant”), resolving the Dispute.  Additionally, the parties agreed to a mutual release, terminating the previous AMER Investment Agreement, the prior Warrant, and the Dispute Negotiation Extension Agreement (“Extension Agreement”).” [SEC EDGAR – General Moly 10-K, 05/04/20]
  • AMER International Is General Moly’s “Largest Shareholder.” “Amer International Group Co. Ltd. has a $4.3 million placement with General Moly out of $10 million earlier pledged, but Amer and General Moly came to a resolution that makes Amer General Moly’s largest shareholder.” [Elko Daily Free Press, 03/05/20]
  • AMER International’s Ownership Gives Them The Right To Nominate Directors To General Moly’s Board. “Additionally, AMER nominated Mr. Siong Tek (“Terry”) Lee to serve the remaining term of AMER’s previous director nominee (Tong Zhang) expiring at the Company’s annual meeting in 2021.  AMER may nominate a second director to the Board so long as its shareholding exceeds 20% of the Company’s shares outstanding.” [SEC EDGAR – General Moly 10-K, 05/04/20]

AMER International Is A Materials Company Based In The Guangdong Province In China. “Amer International Group is a high-technology industry group, which has developed from industrial economy and mainly focuses on the whole industry chain of new electronic information and new materials. The group has striven to develop industrial investment, the development of science and technology smart parks, strategic investment, financial investment, trading platforms, etc. in recent years. It is the world’s leading new metallic materials producer. Amer employs a staff of over 18,000 at present. Located in Shenzhen, Guangdong Province.” [AMER International Group, accessed 05/11/20]

  • AMER International Is Run By Chinese Billionaire Wang Wen Yin And Had Over $70 Billion In Revenue In 2017 Alone. “Wang Wenyin is chairman of cable and copper supplier Amer International Group. Shenzhen-headquartered Amer employs more than 17,000 workers. Amer’s revenue in 2017 totaled $70 billion, according to company figures.” [Forbes, accessed 05/11/20]
  • Wang Wen Yin Is Worth $8.1 Billion. [Forbes, accessed 05/11/20]

…And Is Seeking Loans From Chinese Banks.

AMER International Is Seeking Loans For General Moly After Their Newest Deal. “Under the new SPA, Amer has agreed to use its reasonable best efforts to assist the Company in obtaining a loan from one or more prime Chinese banks (“Bank Loan”), for the Company’s share of construction and development costs at the Mt. Hope Project.  As discussed above, for every $100 million of sourced Chinese bank lending that Amer has assisted in contributing to a completed $700 million project debt financing, Amer may exercise 12 million warrants issued under the New Amer Warrant at an exercise price of $0.50 per share, up to 80 million warrants.” [SEC EDGAR – General Moly 10-K, 05/04/20]

General Moly Has Other Overseas Investors With A History Of Insider Trading And “Mafia-Style Crimes” That Own Over 5% Of The Company…

Hanlong Mining Investment, Nelson Chen, Hanlong Resources Ltd, Sichuan Hanlong Group, Geng Liu, YiFan Liu, XiaoPing Liu, And Xue Yang Have Over 5% Beneficial Ownership Of General Moly And Are Based In China. “All of the voting and investment power with respect to shares held in the name of Hanlong USA have been delegated to Mr. Chen.  The address for Hanlong USA is Suite 6303-04, 63/F., Central Plaza, 18 Harbour Road, Wanchai, Hong Kong.  The shares that are directly owned by Hanlong USA are also indirectly beneficially owned by each of Hanlong Resources, Sichuan Hanlong, Geng Liu, YiFan Liu, XiaoPing Liu, and Xue Yang. […] The addresses for each such person (other than Hanlong USA and Mr. Chen which are above) are: (a) in the case of Hanlong Resources, Suite 6303-04, 63/F, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong; and (b) in the case of Sichuan Hanlong, Geng Liu, YiFan Liu Xiaoping Liu, and Xue Yang, 20F, Hongda Building, No. 2 East Jin Li Road, Chengdu, Sichuan 610041, China.” [SEC EDGAR – General Moly DEF14A, 04/29/20]

  • Hanlong Mining Has Its Own Troubled Past With A History Of Insider Trading And “Mafia-Style Crimes.” “An Australian court has sentenced a Chinese former executive to more than eight years in prison for insider trading in 2011 when his privately-owned energy conglomerate Sichuan Hanlong Group subsidiary was preparing takeover bids for two Australian mining companies. Hui Xiao, also known as Steven Xiao and Jiayi Xiao, had pleaded guilty in the New South Wales Supreme Court in Sydney in September to 102 illegal trades of shares in Sundance Resources and Bannerman Resources. […] His former boss Liu Han, chairman of the parent company Sichuan Hanlong Group, was executed in the Chinese southwestern province of Sichuan last year for mafia-style crimes.” [Associated Press, 03/11/16]

Luxembourg-Based APERAM And Amo Holding Own Over 5% Of General Moly. “Based on a Schedule 13G filed with the SEC on January 28, 2011, by APERAM and AMO Holding 7 S.A. and a Form 3 filed with the SEC on January 28, 2011, by APERAM.  According to such Form 3, on January 25, 2011, the Board of Directors of ArcelorMittal S.A. (“ArcelorMittal”) and APERAM each approved the transfer of the assets comprising ArcelorMittal’s stainless and specialty steels business from its carbon steel and mining business to APERAM, a separate entity incorporated in the Grand Duchy of Luxembourg.  Following such transfer, AMO Holding 7 S.A. became a wholly owned subsidiary of APERAM.  APERAM and AMO Holding 7 S.A. share voting and disposition power for all shares shown as beneficially owned by them.  The addresses for APERAM and AMO Holding 7 S.A., respectively, are 12C, rue Guillaume Kroll L-1882 Luxembourg, Grand Duchy of Luxembourg and 19, Avenue de la Liberté, L-2930 Luxembourg, Grand Duchy of Luxembourg.” [SEC EDGAR – General Moly DEF14A, 04/29/20]

Terry Lee, The Director Added By AMER International Is Based In China And Owns 80,000 Shares Of General Moly. “The address for Mr. Lee is c/o 29/F, Block A, East Pacific International Center, 7888th Shenzhen Blvd., Shenzhen, 518040, China.” [SEC EDGAR – General Moly DEF14A, 04/29/20]

…And General Moly’s Primary Asset Is Owned, In Part, By A South Korean Company

General Moly’s Main Asset Is An 80% Interest In The Mt. Hope Mining Project In Nevada. “Our main asset is an 80% interest in the Mt. Hope Project (“Mt. Hope Project”), a primary molybdenum property, located in Eureka County, Nevada.” [SEC EDGAR – General Moly 10-K, 05/04/20]

South Korean Mining Company POS-Minerals Owns The Other 20% Of Mt. Hope Mining Project. “General Moly is continuing the efforts to obtain financing for its 80% share of Mt. Hope. The 20% owner of Mt. Hope is POS-Minerals Corp., a subsidiary of POSCO of South Korea.” [Elko Daily, 03/05/20]

General Moly Has A History Of Financial Losses From Well Before The Coronavirus Pandemic

General Moly Had $19 Million In Net Losses The Last Two Years And Expected To Continue Losing Money Before Coronavirus.

General Moly Had A Net Loss Of $7.9 Million In 2019. “For the year ended December 31, 2019 we had a consolidated net loss of $7.9 million compared with a net loss of $11.1 million in the same period for 2018.” [SEC EDGAR – General Moly 10-K, 05/04/20]

General Moly “Does Not Generate Revenues” And Has “Significant Recurring Losses.” “[T]he Company does not generate revenues, has incurred significant recurring losses, and does not have sufficient liquidity and capital resources to fund its operations and meet its financial obligations, which raises substantial doubt about its ability to continue as a going concern.” [SEC EDGAR – General Moly 10-K, 05/04/20]

General Moly Anticipates Continued Losses Moving Forward. “We are currently incurring losses and we expect to continue to incur losses until sometime after molybdenum production begins at the Mt. Hope Project.  The LLC may never achieve production at the Mt. Hope Project and may never be profitable even if production is achieved.” [SEC EDGAR – General Moly 10-K, 05/04/20]

There Are Doubts As To If General Moly’s Main Asset, The Mt. Hope Mining Project, Will Ever Reach Production Or Be Profitable. “We are currently incurring losses and we expect to continue to incur losses until sometime after molybdenum production begins at the Mt. Hope Project.  The LLC may never achieve production at the Mt. Hope Project and may never be profitable even if production is achieved.” [SEC EDGAR – General Moly 10-K, 05/04/20]

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