The Ontario Securities Commission says it will not appeal the acquittal of Former Bre-X Minerals Ltd. vice chairman John Felderhof three weeks ago on illegal insider trading before the gold mining company was revealed as a fraud.

In a brief statement released today, the OSC said that “having considered the reasons for decision issued July 31, 2007 by The Honourable Mr. Justice Peter Hryn of the Ontario Court of Justice, it has decided not to pursue an appeal.”

Felderhof was the company’s former vice-chairman and chief geologist. The Ontario Securities Commission accused him of eight Securities Act violations — four counts of illegal insider trading and four counts of sending out misleading news releases.

Felderhof sold $84 million worth of Bre-X stock in 1996, just before the company’s supposedly rich gold project in Busang, Indonesia, was exposed as a fraud.

The OSC has alleged that Felderhof illegally acted on insider information when he sold the shares. The OSC has also accused him of putting his name to news releases the regulator said he should have known were misleading. He has denied all the allegations, saying he was taken in like everyone else.

The Calgary-based company was a stock market darling from 1995 to 1997.

Bre-X claimed it had discovered huge amounts of gold in the Busang area of Indonesia. The company’s shares soared from penny stock status to more than $200 a share.

But by the spring of 1997, everything began to unravel. New tests carried out by another company showed there was virtually no gold in the Bre-X deposit. The original positive assay results had been sprinkled with gold from other sources.

Bre-X stock tanked, costing thousands of investors in the once high-flying company as much as $6 billion.

Despite demands for someone to be brought to justice for the fraud, no one was to ever face criminal charges.

Bre-X geologist Michael de Guzman had died mysteriously in March 1997, after apparently committing suicide by jumping from a helicopter into the Indonesian jungle.

Bre-X president David Walsh died in 1998 after suffering a brain aneurysm at his home in the Bahamas.