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Friday September 13, 2013, 6:35am PDT

By Vivien Diniz2 - Exclusive to Graphite Investing News3

For graphite junior Zenyatta Ventures5 (TSXV:ZEN6), who according to their website has a rare style of graphite deposit, being in the center of attention is nothing new. From praise to criticism, I am fairly certain that the Northern Ontario-based, graphite-focused company has seen and heard it all. This week was no different with the company being labeled as “Under Surveillance” but The Street Sweeper7.

Buyer beware?

On Monday, the spotlight was shone on Zenyatta once more with an article that screamed at investors: “buyer beware.” The article started off by pointing out that although the company has not yet produced a NI 43-101 compliant resource, Zenyatta has been subject to a lot of hype compared to its peers in the graphite sector, leading the author to conclude that “if nothing else, the company knows how to sell a tantalizing story.”

The article, which by now has likely been read many times over, also cross-examines Zenyatta’s CEO, Aubrey Eveleigh, painting him as a very skilled yarn spinner who has been able on several occasions to keep companies afloat on promotion alone. Further to Monday’s piece comes another on Thursday, where once more, the publication takes a crack at the CEO, in an attempt to further discredit Zenyatta.

Adding to further confusion brought on by The Street Sweeper pieces are the easy-to-miss disclosure at the end, where publication casually mentions a short position in Zenyatta, as well holding positions in other graphite companies mentioned. Clearly, while telling investors to be wary of investment in Zenyatta, the publication holds positions and stands to gain from price fluctuations.

Readers beware

In response to the attention from publication, Zenyatta’s share price experienced negative price movements. From a morning price of $3.81 per share, the company was down at $3.08 by the end of the day. In quick response to the slanderous piece, Zenyatta released a note to investors, ensuring them that the company would defend itself against “unfounded and misleading information.”

Fair enough.

On Wednesday, an article published by InvestorIntel9 supplied investors with an exposé called “Flagrant foul called on a convicted felon’s short-selling ‘hit’ on Zenyatta.”

In her article, Tracy Weslosky brings the author of the “hatchet piece” as Melissa Davis, editor of The Street Sweeper10 who reportedly has a keen eye for spotting fraud) and Hunter Adams, a memeber fo the company’s advisory board and a reformed stock manipulator with alleged crime family ties, under the microscope.

Not taking any cracks at trying to explain any of the allegations against, InvestorIntel looks at the possibility that the “Clean up Crew” stands to make a buck through discrediting the graphite junior.

Zenyatta weighs in

Given the situation, where two vehemently negative articles and a more positive article that aims to turn the tables, one has to start wondering what the heck is going on.

Graphite Investing News reached out to Zenyatta’s CEO Aubrey Eveleigh to help investors navigate through the facts or fictions in the latest claims.

“Zenyatta reminds the investment community that all official information regarding the Company must be derived solely from disclosure documents filed on www.sedar.com11, and on the Company’s website, www.zenyatta.ca12. All public disclosures provided by Zenyatta are full, complete, accurate and factual as required by reporting standards.”

When asked how he feels about the personal attacks being made, Eveleigh told us that the debate “is about Zenyatta or our unique graphite project.”

And this is true. Zenyatta has been the subject of a lot of attention and perhaps rightly so. Zenyatta’s deposit, is very different from others in its field.

“We have discovered a very unique hydrothermal graphite deposit.” Eveleigh told Graphite Investing News. “People either do not understand what we have discovered or choose not to understand it.”

One of the main critiques that the investment community hears when it comes to Zenyatta is the company’s lack of a resource. In a June interview13 with Eveleigh, he gave a time frame of September-October for the resource estimate. Eveleigh confirmed that the work is on target and investors should be on the look our for some news regarding progress in the coming weeks.

Eveleigh maintains that Zenyatta “has come a long way in 12 months and will continue to advance a very special graphite project over the coming months.” In light of the recent attention the company is receiving, he has made it clear “It is more important to stay focused on where we are headed rather than the day to day trading.”

As September reaches its mid-point, and the much anticipated resource estimate from Zenyatta draws closer, one has to wonder if the timing is right to attempt to discredit a company that has come so far, so fast. Understandably, this question is rhetorical, but given the flurry of news lately, one should be questioning what is going on.

What is an investor to do?

While I can sit here and research the ins and outs of the allegations made against Zenyatta, and present the facts as I have found them, that is not the point I am trying to make.

The most important thing that you, as an investor, need to be aware of is that regardless of what is published by third-party sources, in the end the onus is on you to perform your own due diligence on any investment you make.

It is no secret that investing in the resource sector is incredibly risky and not for the faint of heart. And combined that with living in an internet age where every opinion is displayed for all to see, it is paramount to do your homework.

Read the reports, look at the financials, and see what the experts are saying. And don’t be afraid to ask questions.