Reno Chris

Buying Your Own Mining Claim: Let The Buyer Beware

26 posts in this topic


The investor has fronted money for purchase of recovery equipment, plus expenses, received nothing in return, yet is convinced that with more money to buy different (better) equipment he will realize his profit.

It's the "Sunk Cost Fallacy." When someone has already invested so much money they are easily convinced that just a few thousand more will finally get them the riches that they deserve.


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People generally want to believe what they want to believe, and as long as you play to that it is relatively easy to con people. I could have been a great con man but my parents raised me right. Being in business I did see many played however.

The three most common I saw in Alaska were:

1. Selling worthless ground by association/proximity. All you have to do is stake worthless ground on or near good proven ground, the more famous the better. For example, Bonanza Creek produced tons of gold, but only in the last five miles of its eight mile length. Stake claims on the worthless upper three miles, point at all the history and production downstream - easy sale.  Regular folks do not understand how gold deposits work and think if found in one part of a location it is found everywhere else.

2. Just a little more money needed. We have this great ground, and have invested much time and money, and are now almost to the fabulous glory hole. All we need is for you to invest XXXX dollars now and by this fall you will get ten times that back. Somehow most of the money goes to paying my expenses/wages and the glory hole never gets found. Goes well with number 1. above.

3. Believe it or not I have seen the gold from water scam played repeatedly. Glacial silt in water is a popular source of micron gold that can be recovered with the right magic filters. Due to all the glacial silt in Alaska waters and the general Alaska mystique it is a popular destination for people running this scam.

The fun part is you are generally wasting your time trying to talk people out of being conned. They will often defend the scammer and even get angry if you push it too hard. The "sunk cost" fallacy from the post above also applies to minds made up. We have invested ourselves into a decision, and will resist being proven wrong. So much so that when presented with contrary evidence, we will decide the evidence is wrong before admitting we are wrong. Attempting to talk someone out of being conned can actually make people more inclined to accept the con.

Outright scams blend seamlessly into legal marketing and so caution is always called for. In general, if you are being told what you want to hear, be cautious.

A. If you buy this detector device, learn it well, put in the time to research and hunt the right places, and work real hard at it, you may do well.

B. If you buy this detector device, it will easily pay for itself.

The difference is obvious - beware easy answers.

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You just never know.   My neighbor invested $10,000 in the mine in New Mexico – he liked the guy and had Visited the area of the mine and decided it would be cool to be able to go there anytime He wanted. He asked me to look at all the paperwork and told him I would not spend my money on it but that in was a non-recourse arrangment, the worst that could happen was to kiss the $10k goodbye. He was convinced he wanted to go ahead.  About eight months later the mine got sold and my friend tripled his money – so much for my expertise and advice.  Lol

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  Hey Fred! I have a mine with $1,000,000 of gold. Would you happen to have $2,000,000 to invest?

 Happened to get another call from a claim owner that seems to have been defrauded. That's 4 this month.

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Chris ; I don't have a lot of sympathy  for someone who buys a "gold mine" with out doing their own diligent appraisal and I have never charged any one for my opinion of a mining property even though that opinion may be worth upward of 2 cents. The problems I am getting questions on are posting over the top of a recorded and registered claim with a fraudulently dated location notice, floating a claim with repetitious recordings until the claim can be marketed on a website, telling a legitimate claimant that "this is my claim but some one must have removed the location notice", claiming to have constructed a 3' rock mound with a 2x2 wooden stake erected in it in February - in the Gold Lake area and some that I won't mention on a public forum as it looks like they may wind up in court. Your always welcome to call anytime and I can be a little more specific. 

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This sounds so familiar. Oh wait I have seen about 100 of these in my NORTHERN CALIFORNIA area. Oops. I think the two guys here that do this are simply bad people. I've met both on numerous occasions and I got nothing for ether of them. I really don't like it when going to a claim with friends and they've had it for decades and there's a location notice. I noticed that these people never looked up the claim and they don't have the right area of where they claim to have claimed. It's horrible just horrible. These painted red little posts and a pile of rocks or some in concrete just got waisted. Time and money that could have been spent legally and legitimately to reach their goal. I'm just sick!

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  • Similar Content

    • By Steve Herschbach
      Another question via email, with personal references removed. I prefer to answer these on the forum so everyone gets the benefit of the answer plus others can offer their opinions also.
      "I am new to metal detecting and, your site here has really helped me out. I have a couple questions that maybe you can help me out with. What are some of the geologic indicators that you look for to determining where to prospect for nuggets? I try to study some of the geology maps but I could use some further pinpointing. I have also been looking at the National map of Surficial Mineralogy. Using the aster and minsat7 maps what are some of the indicators that may point you to higher gold bearing ground? Any help would be deeply appreciated.
      Could you point me to some old places where you have found gold? I'm not asking to be shown active patches. Just areas that you feel are worked out. I just want to see what gold bearing ground looks like. This would help me to start to learn the commonalities and characteristics of gold bearing grounds.
      Still looking for that first nugget! Thanks again for any info you can provide."
      My method is much simpler than that. I basically look for gold where gold has been found before. Think of it like fishing. If you want to go catch salmon you have two options. You can go to where people have caught salmon before - pretty good odds here. Or you can go where nobody has ever caught a salmon before. Very poor odds!
      So call it prospecting using history to determine where gold has been found before, and then getting as close as I can to those places. History and proximity. Finally, I may then employ geology to narrow that search in a given area if it turns out the gold is confined to certain rock types.
      The first place I normally turn as a rough guide to any new location in the U.S. is:
      Principal Gold Producing Districts Of The United States USGS Professional Paper 610 by A. H. Koschmann and M. H. Bergendahl - A description of the geology, mining history, and production of the major gold-mining districts in 21 states. This 1968 publication obviously lacks the latest production figures but it still is a great overview to where an individual prospector can look for gold in the United States. It is a 283 page pdf download so be patient. Pay particular attention to the listed references in the extensive bibliography for doing further research.
      You can download this at and find many more useful free books on this website at the Metal Detecting & Prospecting Library

      So just for fun let's say I want to go look for gold in New Mexico. The section on New Mexico starts on page 200 and here is a quick summary of the opening paragraphs:
      "The gold-producing districts of New Mexico are distributed in a northeastward-trending mineral belt of variable width that extends diagonally across the State, from Hidalgo County in the southwest corner to Colfax County along the north-central border. From 1848 through 1965 New Mexico is credited with a gold production of about 2,267,000 ounces; however, several million dollars worth of placer gold was mined prior to 1848. Mining in New Mexico began long before discoveries were made in any of the other Western States (Lindgren and others, 1910, p. 17-19; Jones, 1904, p. 8-20). The copper deposits at Santa Rita were known and mined late in the 18th century, and placer gold mining began as early as 1828 in the Ortiz Mountains south of Santa Fe. In 1839 placer deposits were discovered farther south along the foot of the San Pedro Mountains. The earliest lode mining, except the work at Santa Rita, dates back to 1833 when a gold-quartz vein was worked in the Ortiz Mountains. In 1865 placers and, soon afterward, quartz lodes were found in the White Mountains in Lincoln County; in 1866 placer deposits were discovered at Elizabethtown in Colfax County, and silver-lead deposits were discovered in the Magdalena Range in Socorro County. In 1877 placers and gold-quartz veins were found at Hillsboro, and in 1878 phenomenally rich silver ore was found at Lake Valley in Sierra County.
      The mineral belt of New Mexico is in mountainous terrain that lies between the Colorado Plateau on the northwest and the Great Plains on the east. It is a zone of crustal disturbance in which the rocks were folded and faulted and intruded by stocks, dikes, and laccoliths of monzonitic rocks. Deposits of copper, lead, zinc, gold, and silver occur locally throughout this belt. Some deposits of copper and gold are Precambrian in age, but most of the ore deposits are associated with Upper Cretaceous or Tertiary intrusive rocks. The gold placers were probably derived from the weathering of these deposits. In later Tertiary time lavas spread out over wide areas of the State, and fissures within these rocks were later mineralized. These fissure veins are rich in gold and silver, but in most places they are relatively poor in base metals. In New Mexico, 17 districts in 13 counties yielded more than 10,000 ounces of gold each through 1957 (fig.19).
      Figure 19 is a handy map showing us where you want to look in New Mexico and also where looking is probably a waste of time. Click for larger version.

      The map shows what the text said "The mineral belt of New Mexico is in mountainous terrain that lies between the Colorado Plateau on the northwest and the Great Plains on the east." Sticking to this area is going to be your best bet. Based just on this map I see two areas of general interest - the central northern area, and the southwestern corner of the state.
      The text mentions that placer deposits were discovered at Elizabethtown in Colfax County, and the map shows that as the Elizabethtown-Baldy mining district. Following along in the text we find this:
      "The placer deposits along Grouse and Humbug Gulches, tributaries of Moreno Creek, each yielded more than $1 million in placer gold and silver. Another $2 million worth of placer gold and silver was recovered from the valleys of Moreno and Willow Creeks (Anderson, 1957, p. 38-39), and some gold also came from the gravels along Ute Creek. Graton (in Lindgren and others, 1910, p. 93) estimated the placer production of the Elizabethtown-Baldy district prior to 1904 at $2.5 million, and C. W. Henderson (in U. S. Bureau of Mines, 1929, pt. 1, p. 7 40) estimated the production through 1929 at about $3 million (145,138 ounces). The total placer production through 1959 was about 146,980 ounces."
      The reference material from the passage above is in the back of the book and is where we can get real details. Google is our friend. This stuff used to take me lots of visits to libraries!
      Anderson, E. C., 1957, The metal resources of New Mexico and their economic features through 1954: New Mexico Bur. Mines and Mineral Resources Bull. 39, 183 p.
      Lindgren, Waldemar, Graton, L. C., and Gordon, C. H., 1910, The ore deposits of New Mexico: U.S. Geol. Survey Prof. Paper 68, 361 p.
      Henderson, C. W., 1932, Gold, silver, copper, lead, and zinc in New Mexico: U.S. Bur. Mines, Mineral Resources U.S., 1929, pt. 1, p. 729-759.
      That is more than enough, but let's also Google placer gold new mexico
      Lots of great links there, but two jump out:
      Placer Gold Deposits of New Mexico 1972 USGS Bulletin 1348 by Maureen G. Johnson
      Placer Gold Deposits in New Mexico by Virginia T. McLemore, New Mexico Bureau of Mines and Mineral Resources May 1994
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      That last one is a real gem and contains this passage:
      "All known placer deposits in New Mexico occur in late Tertiary to Recent rocks and occur as alluvial-fan deposits, bench or terrace gravel deposits, river bars, stream deposits (alluvial deposits), or as residual placers formed directly on top of lode deposits typically derived from Proterozoic, Cretaceous, and Tertiary source rocks (eluvial deposits). During fluvial events, large volumes of sediment containing free gold and other particles are transported and deposited in relatively poorly sorted alluvial and stream deposits. The gold is concentrated by gravity in incised stream valleys and alluvial fans in deeply weathered highlands. Most placer gold deposits in New Mexico are found in streams or arroyos that drain gold-bearing lode deposits, typically as quartz veins. The lode deposits range in age from Proterozoic to Laramide to mid-Tertiary (Oligocene-Miocene) (Table 2). There are some alluvial deposits distal from any obvious source terrains (Table 2). Eluvial deposits are common in many districts; some of the larger deposits are in the Jicarilla district."
      So now we have a lifetime of ideas on where to go and a basic idea of the geology. And an even better map! Click for larger version.

      Let's look for specific site information.
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      3. Click on Colfax County Mines
      4. Click on Elizabethtown - Baldy District
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      An alternate site...
      1. Go to
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      5. Click on Colfax
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      6. Click on Browse All Deposits or Use The Interactive Map
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      One more...
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      Historic claim staking activity can be a clue. You can get the Big Picture by looking at Mine Claim Activity on Federal Lands for the period 1976 through 2010
      OK, that really should have answered your question. As far as places I have been, they are nearly all in Alaska and can be found here
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      Prior thread on finding claims information.
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    • By Trent King
      I was doing a quick search of gold mine sales in Australia to suss out the market.  Came across this gold mine sales mob who have cut and copied my gumtree ads and added random pictures??wtf
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    • By Reno Chris
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    • By Rege-PA
      If a claim is filed as a lode claim, can it still be detected on by someone else?
    • By TintedSnow
      Is there a way to search land records/claims by owner's name? I have a friend who is looking for where his grandfather's claim was many years ago. I know it's somewhere on the Kenai Peninsula, but that's about all we know. Thanks!
    • By Clay Diggins
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      Go get u sum