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DGSE Companies Inc. Message Board

  • gsbh1976 gsbh1976 Apr 17, 2012 7:03 PM Flag

    is everyone stunned into silence?

    incredible to me there is not ONE single post on this company basically imploding on itself and being revealed as a giant accounting fraud. nobody has anything to say? non reliance upon FIVE years of financials??!?

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    • duly noted. And amusing psychotic ranting response you made. Here are some other issues/bizarre transactions to be noted.

      On November 2, 2011, the Company announced that Texas Capital Bank has agreed to renew its current credit facility. The facility is composed of a $3.5 million revolving note and a $1.0 million term loan. The agreement was finalized on November 2, 2011. Borrowings under the revolving credit facility are collateralized by a general security interest in substantially all of our assets. As of September 30, 2011, approximately $4.5 million was outstanding under the term loan and revolving credit facility. If we were to default under the terms and conditions of the revolving credit facility, Texas Capital Bank would have the right to accelerate any indebtedness outstanding and foreclose on our assets in order to satisfy our indebtedness. Such a foreclosure could have a material adverse effect on our business, liquidity, results of operations and financial position. This credit facility matures in June 2012.

      oops, they will either have to pay this off very quickly, or this will be clearly be violated. Anyone with a cerebral cortex can figure this out. Would you be a BIT concerned if you were this bank??
      --------------------------------------------
      On May 16, 2011, the Company issued 125,000 shares of its common stock to NTR Metals, LLC to settle approximately $511,000 of outstanding trade payables.

      On September 12, 2011, the Company issued 400,000 shares of its common stock to NTR Metals, LLC to settle $2,000,000 of outstanding trade payables.

      These are very strange transactions to go along with all the other unusual transactions NTR has done, esoecially the "inbred" ones with Dr. Smith who somehow managed to disappear into the sunset before this all blew up. How convenient for him? Perhaps someone will post some of his past impressive work where he got in a bit of trouble.

      • 1 Reply to gsbh1976
      • I think it is wise to observe this development even-handedly.

        While I can understand speculation that the complex transactions that Dr. Smith engaged during his entire tenure may be the cause, I would be more circumspect. DGSE absorbed an acquisition with Superior Galleries during this period, and also dealt with the Stanford fiasco. I'm more inclined to believe that these are the root causes of any irregularities.

        Indeed, the 8-K indicates inventory and other balance sheet issues that were handled by the previous CFO. The danger with a microcap company that has long-standing management is that 99% of the time it breeds consistency and reliability, and the other 1% of the time it allows an unscrupulous person with total access to play games.

        Ironically, I am not concerned about past earnings being impacted. The company prior to NTR's involvement was a different beast. Those operations never really went anywhere. The issue is revenue and earnings going forward.

        The only concern for my part is the state of balance sheet. Are assets and liabilities materially different? Does the liquidity necessary for continued expansion still exist? Is any debt now due as a result?

        Other than those issues, this is one of those rare instances in which circumstances for the company are so different today than yesterday that the story may not change.

    • that is the most outrageous, irresponsible post i've ever read on ANY board for many a year. I "play" on these boards for entertainment and, sometimes, exchange of worthwhile intelligent thoughts and opinions on various subjects. I'm responding to your ludicrous, uninformed comments ONLY because i've been a frequent poster here over the years and don't want to disappear at the 1st sign of an unfavorable release. Your characterization, through use of the "F" word, and a company imploding is sheer, total and unadulterated ignorance.
      I strenuously object to your "burial" of the patient before they have even left the OR.
      Further, if you took the time to do any DD on this Co you'd see clearly a new investment opportunity began with the purchase by NTR of $3mm shares at $1.20..an entirely new opportunity began at this point in time...personally, i'm only interested in what has, and will happen from that point forward...the rest of the BS is yesterday's news...most don't know and don't care about '07,'08'09 etc. (BTW-with all the Banks, Investors, Vendors etc involved during that period where were their auditors and finc'l brains..certainly they must have all scrubbed the numbers..or should have)
      Finally, you obviously have no corp operating experience.
      Just think of the potential for error in a small, undercapitalized Co, with a gazzillion SKU's, trading bullion and other metals, operating pawn and pay day loan operations from multiple locations...all with an under paid i'll equipped CFO...do you think a few debits and credits might have been screwed up..YOU THINK???

      PS: my hat is off to Mgt for standing up and making an honest call...my guess is they could have slid through...also read the very last release 4/17...business goes on, expands all with support of NTR...release was VERY well done!! I only wish stock had opened and traded down to $2 or $3...i'd be a BIG buyer!!

      • 3 Replies to wonderslimman
      • P.S. I would say some of NTR's bizarre transactions are going to be looked at very closely, especially some of the "mark up" trades they did in the open market at times which were quite stupid as well as the dealings with Dr. Smith. I would take a pill and stop trying to be a stock pumper of a stock with numerous problems facing it including fraudulent accounting. My gut feeling tells me their inventory #'s are going to be a big part of this mess, as well as all sorts of strange inter-company transactions between affiliates. (Reminds me a bit of our friends at Stanford Investments...how did they turn out??) I am just stating facts. Nothing more, nothing less.

      • lol. Good one. I wonder if this is Dr. Smith (banned by SEC numerous times before getting involved with this lovely company and jumping ship before everything blew up..) writing this? Funny stuff. Good luck with everything.

      • I didn't think first post was anymore outrageous than your reply. I would invite you to ZNGA, LCC boards to name a few if you want to see outrageous posts! Jury is out, can't say there is or isn't any fraud going on. Remains to be seen. Hard fact, jury is deliberating, stock is halted. Apparently "A few debits and credits misplaced" would be a big deal in the auditing world. Seemingly solid company. Agree with stunned silence. Hard to talk while holding your breath. Hoping it will all blow over quickly. Good luck to all.

 
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