Spanish Mountain Gold Ltd. (TSX-V: SPA), a Vancouver junior exploration company with a gold project in central B.C., says it will be filing amended statements of executive compensation after a forensic audit uncovered what it claims are “benefits and perquisites” not previously disclosed by the company’s former CEO and CFO.
The company said it will be filing amended statements for a ten-year period, between 2012 and 2022, and will seek repayment of severance and for what it describes as “unauthorized personal benefits” paid to the former CEO.
The company alleges that certain “irregularities in document and financial management” were discovered after former CEO Larry Yau left the company in March 2023.
BIV was unable to reach Yau for comment following multiple attempts.
Yau served as the company’s CFO from January 26, 2010 to June 26, 2019, the company said, and as CEO from June 1, 2015 to March 4, 2023.
“After Larry Yau left the company as CEO in March 2023, irregularities in document and financial management were discovered,” the company said in a Dec. 21 news release.
The board of directors retained “independent international professional services” to conduct an audit.
“The board has now received a draft report with the findings of the independent forensic auditor,” the company said.
“Given the documentary evidence recovered, and the findings of independent forensic auditor, the company is amending certain previously filed continuous disclosure documents, will change its auditors, and will seek indemnification from the former CEO for, among other things, the previously paid severance benefit, all unauthorized payments and all related costs and expenses."
“Among the benefits to be disclosed in the amended filings are payments to the former CEO for a personal residence in Vancouver made from 2016 to 2022 totaling $439,750,” the company said.
“The company will take appropriate steps to obtain repayment of such unauthorized personal benefits, and also recover the severance that was paid to the former CEO in the amount of $240,000. The severance was paid to Larry Yau prior to the company uncovering activities undertaken by the former CEO that now justify a ‘for cause’ termination.”
