former Bre-X chief geologist
Peter Breiger, Financial : Tuesday, July 31, 2007
TORONTO -- Former Bre-X Minerals Ltd. geologist John Felderhof has been found not guilty of insider trading and issuing false press releases, a decade after the company was exposed as a massive fraud. Mr. Justice Peter Hryn cleared Mr. Felderhof of all eight charges laid by the Ontario Securities Commission in May, 1999
Regulators allege Mr. Felderhof sold $84-million worth of Bre-X stock based on information not disclosed to the public. He was also charged with four counts of issuing false press releases, which reported growing gold reserve estimates. "I find Felderhof has proven he took reasonable care," Judge Hryn told a Toronto courtroom. Bre-X, a one-time market darling, collapsed in the spring of 1997 after its Busang property was revealed as a fraud, erasing more than $6-billion in shareholder value. At its height, shares in the Calgary company climbed above $280 as investors latched on to reports the company's mine contained a startling 50 million ounces of gold. Mr. Felderhof, who lives in Indonesia and did not attended the trial regularly, faced jail time and millions of dollars in fines if convicted.
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