Canada To-day and To-morrow

by Arthur E. Copping

“That,” said Mr. Brock quietly, “is a harsh but not unwarranted way of putting it. However, a man who is willing to buy a pig in a bag does not require to leave home to find those willing to accommodate him. I am prompted at once to say two things: in the first place, the practices to which I refer are confined to a small minority of a large and honourable class of men; and, secondly, those who act in this way are actuated by a belief that, where the wits of one man are pitted against those of another, the keener party is entitled to any advantage he can secure. These men are, you must remember, born gamblers; and they lay themselves out to win, not so much for the sake of the material profit (they are mostly men of substance) as for the sport of the thing.”

“Fraud for fraud’s sake,” I interjected.

“Please understand,” Mr. Brock again reminded me, “that I am explaining, not exculpating, their conduct. And, as a matter of fact, no resentment that you can express at these miscarriages of capital can equal the regret they excite among responsible people in this country. For British capital is an important factor in Canada’s development; and it is therefore greatly to the interests of Canada that British capital should, in all cases, be invested in mines that will pay well, and thereby serve as a magnet for further British capital.”

“Will you,” I asked, “make the position clearer by indicating the sort of meshes in which my unsuspecting countrymen get entangled?”

“Well,” said Mr. Brock, “occasionally they are represented by a man who pays too much attention to what he is told. Such a man may travel over a good deal of territory, meet a number of mining folk, and hear a great deal about the exceptional merits of, let us say, the M. Tee property, until he places an undue valuation upon it, and is consumed by a desire to become its possessor.”

“And so,” I exclaimed, “that most treacherous form of conspiracy is considered by the guilty parties as sport?”

“Call it what you will,” Mr. Brock replied, “but the interests of Canada, as well as of the English investor, demand that a different type of representative should be engaged.

“Another cause of non-success has been the time at which British capital has been invested. It has come in on the crest of a boom, a prospect being purchased as, and at the price of, a mine. When the prospect fails to develop into a mine—and only a very small percentage of prospects can reasonably be expected so to develop—one more investment is announced as a failure. If prospects are invested in, the investors should be prepared to take up a considerable number, and only after careful selection, so that there may be a reasonable chance of one of them developing into a mine. The selection should be made on the best possible technical advice, which should include the recommendation of a reputable expert who has local knowledge. The mining engineers of Canada are as intelligent and reliable as those to be found elsewhere, and they have their local reputations at stake and—I am sure I can add—their country’s good at heart. That expert local knowledge is the best insurance one can have against an unfortunate investment. No matter how tempting an option may seem, it should not be taken up until there has been a personal investigation by, and a favourable report from, an expert of professional standing and local knowledge. When that principle is more generally understood and acted upon, Canadian mines will become reliable and prosperous investments for British capital, instead of mere speculations.

“You are not altogether free from the wild-cat promoter. There have been instances of properties being purchased, without regard to their merit or lack of merit, in a district that happened to be in the public eye, and, following the appointment of a management calculated to command confidence, the investor has been invited to subscribe for stock. In the case of property purchased in such a way, it would not be at all surprising if the best management in the world should fail to achieve success.

“Of lavish and superfluous expenditure on home offices I have already spoken. At the mine itself there has also been, in some instances, a good deal of money wasted on excessive plant and improvements—notably on permanent works when only those of a temporary character were warranted. This extravagance has resulted largely from a want of familiarity with local conditions.