Bre-X Shares Plummet After Fraud Exposed

Shares in disgraced Bre-X Minerals Ltd. crashed to rock bottom, and Indonesian authorities halted the company’s operations following revelations that its much-touted gold find in Borneo was an intricate fraud. Shares once worth more than $200 apiece traded for a few pennies on the Toronto Stock Exchange in the first day of trading for Bre-X since the hoax was exposed Sunday. Traders said some investors were buying up the near-worthless stock in hopes Bre-X share certificates would become collectors’ items. In Indonesia, government officials halted all of Bre-X’s operations there pending an investigation. Canadian stock market regulators and the Royal Canadian Mounted Police said they also are looking into the scam. The Toronto exchange, after suspending trading for a day, allowed it to resume Tuesday. Volume in Bre-X set a TSE record and forced the exchange to shut down all trading for an hour because of an overload. Trading at between 4 1/2 cents and 10 cents per share put Bre-X’s market valuation at $10 million to $22 million, compared with its peak value of $4.5 billion last year. The stock ended the day by closing at 6 cents per share. In the U.S., Nasdaq said it would halt trading of Bre-X shares until at least May 13, when it will consider whether to continue listing the stock.