Recently, the European Court of Human Rights refused to overturn a French 2002 George Soros conviction for criminal insider trading (Soros paid a fine). Mario Rizzo points out that Soros holds the view that in the financial arena the rule of discretion should hold rather than the rule of law. Rizzo
writes:
Soros said that the complexities of the financial sector require a new class of regulations that may not be simple, predictable and transparent. They may require considerable discretion on the part of regulators. This is because financial markets are the locus of radical uncertainty. It is thus impossible to predict beforehand the kinds of financial-instrument developments that will occur and, especially, the consequences these will have. Thus the financial regulations must be able to be creative in dealing with such developments. This apparently means the rule of law in its traditional sense will have to be bent or compromised.
Guess where discretion was used to bend the rule of law in order to interpret a financial situation, by the European Court? In their ruling against Sorosin the insider trading conviction. Soros lawyers were upset. Rizzo quotes
FT:
“In its decision, the ECHR [European Court of Human Rights] conceded that “the wording of the statutes was not always precise” but said that Mr Soros, as a “famous institutional investor, well-known to the business community . . . could not have been unaware that his decision to invest . . . entailed the risk that he might be committing the offence of insider trading”...“It is inconceivable to expect that the citizen has a better understanding of the law than the authority in charge,” Ron Soffer, Mr Soros’s lawyer, said on Thursday, referring to the billionaire’s criminal conviction by jury.
Rizzo concludes:
Perhaps this is yet another example of the familiar attitude that it is others who need to be regulated because they are greedy and irresponsible. But the advocate of such regulation is as pure as the driven snow.
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