How to Verify a Mining Licence Before You Buy

Why Mining Licence Fraud Persists

Mining licence fraud is durable because it exploits three conditions at once: the documents are unfamiliar to most buyers, the registries are in other jurisdictions and other languages, and the assets are large enough that a plausible opportunity justifies moving quickly.

The economics favour the fraudster

Producing a convincing licence certificate, a mandate letter and a technical report costs almost nothing. Verifying them costs time, and the seller usually applies pressure against spending it: a competing buyer, an expiring option, a government deadline. Urgency is the mechanism, not a circumstance.

What is actually being sold

In the recurring versions the seller is not the registered holder and never was; the licence expired or was forfeited; the licence exists and is valid but this seller has no relationship with it at all; or the licence is real and the seller is real, but the payment account belongs to someone else.

Step One: Read the Document Critically

Before any external check, the document itself often reveals the problem.

Internal consistency

• Does the licence number match the format used in that jurisdiction? Each regime has conventions for prefixes and numbering.
• Are the grant date, term and expiry mutually consistent, and is the licence still within term?
• Does the named holder exactly match the entity offering the asset, including legal suffix?
• Is the area stated consistently in every place it appears, including any annexed schedule?
• Do coordinates place the ground where the seller says the project is?
• Is the issuing authority the correct body for that licence type, named as it currently exists rather than under a former departmental name?

Signals of fabrication

Mismatched fonts and alignment within a single document, a logo at visibly lower resolution than the surrounding text, seals that appear pasted, signature blocks without a named signatory or position, and unexplained references to authorities in other countries. Metadata is also informative: a certificate supposedly issued years ago whose PDF was created last week, in a word processor, warrants explanation.

Step Two: Obtain an Independent Registry Extract

This is the step that resolves most cases, and the step most often skipped because it feels procedural.

Do it independently

Navigate to the mines department yourself. Do not use a link, portal or contact supplied by the seller or broker — cloned registry websites and spoofed departmental email domains are an established technique. Where the register is not publicly searchable, instruct a local lawyer or licensed agent you selected to obtain the extract.

What the extract must confirm

Read the whole register entry

Encumbrances, caveats and pending applications appear in the dealings section rather than on the face of a certificate. A licence can be entirely genuine and still be mortgaged, caveated, or already the subject of an agreement with a different buyer.

Step Three: Verify the Holder Entity and Its Owners

A valid licence held by an entity you cannot identify is not a safe transaction. The corporate check runs parallel to the tenement check.

Corporate verification

• Confirm incorporation and current standing at the companies registry, matching the exact legal name and registration number on the licence.
• Identify directors and confirm the individual signing has authority, supported by a board resolution where the transaction size warrants it.
• Map beneficial ownership through to the natural persons who ultimately control the entity. Layered offshore structures that do not reconcile with the company presenting the offer are a recognised warning sign.
• Screen the entity, its directors and its beneficial owners against UN, EU, UK and US sanctions and PEP lists, and repeat the screening at completion.

Watch for the shelf-company pattern

A company incorporated recently, in a jurisdiction unrelated to the mine, with a single nominee director and no filing history, presenting a licence granted years earlier, is a combination that requires a convincing explanation before any funds or documents move.

Step Four: Test the Mandate If the Seller Is Not the Holder

Most mining opportunities reach buyers through intermediaries, which is legitimate. The question is whether this intermediary has authority.

How to test a mandate

• Read it for scope: does it authorise a sale, or only an introduction? Is it exclusive? Has it expired?
• Check the signatory against the registered directors of the holder.
• Confirm it directly with the holder, using contact details from the register or the company's own filings — never details supplied by the intermediary.
• Be alert to mandate chains. Four intermediaries each holding a mandate from the one above, with no one connected to the registered holder, is a recognisable structure with no authority at the top.

The reverse risk

If you are the intermediary, the same asymmetry runs against you: disclose the asset and the buyer can go straight to the holder. That is what a mining NCNDA is for, and why sequencing verification before disclosure matters to both sides.

Step Five: Verify the Payment Route Before Anything Moves

Genuine licence, genuine holder, wrong account. Payment redirection is the version of this fraud that defeats buyers who did everything else correctly.

Non-negotiable checks

• The receiving account must be in the registered holder's exact legal name. Third-party, personal or agent accounts are a stop condition, whatever explanation is offered.
• Confirm banking details by voice with a known contact on a number you sourced independently — never by replying to the email carrying the details.
• Treat any late change of account details as fraud until independently reconfirmed. Compromised email threads are the most common delivery mechanism.
• Resist advance fees. Requests for licence transfer fees, government processing charges or mandate fees before verification is complete are a standard advance-fee pattern.
• Use escrow or a conditional payment structure tied to registration of the transfer, not to signature of the agreement.

The Verification Checklist

Complete every step. Fraudulent offers usually survive the first two and fail the third.

• Licence document reviewed for internal consistency and signs of fabrication.
• Independent registry extract obtained directly from the regulator, not from the seller.
• Holder, licence type, status, expiry, area and dealings reconciled against the seller's claims.
• Holder entity confirmed at the companies registry; directors and signing authority verified.
• Beneficial ownership mapped; entity, directors and UBOs sanctions-screened.
• Mandate confirmed directly with the registered holder where the seller is an intermediary.
• Receiving account in the holder's exact legal name, confirmed by independent voice contact.
• Payment conditional on registration of transfer, with consents identified as conditions precedent.

Once the licence and the counterparty are verified, the remaining work is the asset itself — encumbrances, expenditure compliance, native title and rehabilitation liability. That sequence is set out in our tenement due diligence checklist, and the technical side in reading JORC and NI 43-101 reports.

Frequently Asked Questions

How do I check if a mining licence is real?

Obtain an extract for the licence directly from the mines department or its online register, using the licence number, and compare it against the document the seller provided. Confirm the registered holder, licence type, status, area and expiry. Never rely on a PDF, screenshot or certified copy supplied by the seller or a broker, and never rely on a link the seller sends — navigate to the regulator independently.

What is a mining mandate scam?

A party presents themselves as authorised to sell a mine or its output on behalf of the owner, produces a mandate letter, and requests fees or documents. The mandate is forged, expired, or was granted by someone without authority. Test it by confirming the mandate directly with the registered holder using contact details obtained independently from the register or the company's own filings, not from the broker.

Can I trust a certified or notarised copy of a mining licence?

Not on its own. Notarisation attests to the copy or a signature, not to the truth of the content or the current status of the licence. Forged notarial seals and apostilles are common in this space. A notarised copy is a starting point for verification, never a substitute for the registry extract.

What does it mean if a mining licence has expired or been forfeited?

The holder has no right to mine or to sell an interest in it, and the ground may be open for application by others. Sellers sometimes market tenements that lapsed years earlier, or that are subject to a pending forfeiture application for unpaid rent or unmet expenditure. The register extract shows current status; a document dated three years ago does not.

Who should pay for licence verification?

The buyer, and it should be treated as unavoidable transaction cost rather than a favour to the seller. Registry searches are usually inexpensive; independent legal confirmation in the jurisdiction costs more but far less than a failed acquisition. Be cautious of any seller who resists independent verification or who asks for a fee to arrange it on your behalf.