- Part Chinese Communist Party-owned uranium play Zeus Resources’ (ZEU) share price rose more than 100 per cent early this week
- Zeus Resources engaged a Singapore-based small-cap ‘consultancy’ boasting a secretive network of WhatsApp groups and encrypted online forums
- Zeus claims to be developing uranium projects in Western Australia — despite a Government ban that will not be lifted
- The agreement with the ‘consultancy’ was announced the same day as Zeus Resources ended a trading halt following a capital raise
- Zeus chairman Dongfeng Zhang, who is also chairman of Chinese Communist Party-owned Zhengyuan International Mining Co, has declined to comment to The Market Herald on Zeus Resources’ activities
Part Chinese Communist Party-owned uranium play Zeus Resources’ (ZEU) share price soared more than 100 per cent early this week after engaging a Singapore-based small-cap 'consultancy' boasting a secret network of WhatsApp groups and encrypted online forums.
Zeus Resources claims to be developing uranium projects in Western Australia — despite a Government ban that will not be lifted.
With a stated interest in developing WA uranium resources, Zeus Resources shares entered a trading halt on Monday June 7 while the company rounded up investors for a capital raise.
Those efforts proved profitable for Zeus, with the share price rising more than 100 per cent from 2.8 cents on Friday, June 4, to 6 cents on Wednesday, June 9, when the company announced the placement had been completed. On Thursday, June 10, Zeus shares closed at 5.8 cents.
Meanwhile trading volume in Zeus reached an astonishing $22.8 million in the five days to June 9, compared with $374,000 over the previous five days and $1.9 million for the five days to June 10, according to the ASX. This for a company with a current market capitalisation of under $10 million.
Zeus’s capital raise has now been completed, despite there being no prospect that the company’s uranium tenements in WA can be developed due to current legislation — and no likelihood of any changes to the policy.
Cloud Securities agreement
Zeus’s trading halt ended the same day as the company announced it had signed a one-year agreement with Cloud Securities (cloudsecurities.asia). The agreement granted Cloud Securities millions of options to find new projects — despite no previous track record of Cloud Securities in the uranium space.
Based in Singapore, Cloud Securities says on its one-page website that it specialises in working with small-cap listed companies.
“We have a wide collection of high net worth and institutional clients, plus thousands of retail clients who support our activities via our various social media channels,” the website says.
Interestingly, Cloud Securities — which was only incorporated in February 2021 — is not registered in Singapore as a financial institution and is not licensed as a fund manager.
The Monetary Authority of Singapore (MAS) makes it clear that any company wanting to engage in the business of fund management must hold a Capital Markets Services (CMS) licence.
The dubious world of WhatsApp investor networks
The chairman of Cloud Securities is Phuket-based Colin Mackay who leads an online network of clandestine investors who work together to buy and sell shares in small cap companies.
In an interview with ‘Window on Phuket’, Mackay describes his life as “very colourful” and says he “squanders” his money on “travelling, bad investments and partying”.
Mackay claims that: “In February 2020 we formally started a WhatsApp group to share our connections and ideas and mainly to find promising undervalued junior stocks.”
Cloud Securities' website calls out Australia and Canada as “particularly fertile markets”:
“Fortunately, many of our members made their millions investing specifically in the junior resource and smaller-cap stock sectors, mainly in Australia and Canada — two particularly fertile markets."
It is unclear if the board of Zeus Resources are aware that the recently incorporated Cloud Securities is connected to a WhatsApp-based investment network, or if this network would be used to engage investors.
WA’s uranium ban
Zeus, which is 32 per cent owned by a Chinese Communist Party subsidiary, says it has interests in three tenements covering approximately 77 square kilometres in Western Australia.
The project areas, Zeus says, are prospective for three main styles of uranium mineralisation.
However, the WA Government imposed a ban on future uranium mining leases in 2017 and a spokesman emphatically told The Market Herald that the current policy is not up for discussion.
“The position for the Western Australian Government hasn’t changed,” the spokesperson said.
“Uranium mining is banned in Western Australia, except for the four uranium projects that received State Ministerial approval from the previous Liberal National Government.
"In making this decision, the McGowan Government has carefully considered the potential liability risk for WA taxpayers.”
WA’s McGowan government was swept back to office in March this year with a historic landslide victory which reduced the opposition to only two seats.
The Market Herald contacted Zeus Resources Chairman Dr Dongfeng Zhang, also the chairman of CCP-owned Zhengyuan International Mining Co., inviting him to comment on this article but there has been no response from him or the company.