GEORGE SOROS, the billionaire hedge fund manager, has lost a case at the European Court of Human Rights to have his criminal conviction for insider dealing quashed.
The failed appeal at the Strasbourg-based court is the latest twist in a nine-year battle by Mr Soros (81) to clear his name following his conviction in France in 2002.
The French criminal case hinged on trades that the Hungarian-born investor had executed 14 years earlier in the stock of Société Générale that reaped his hedge fund, the Quantum Fund, $2.9 million in profits.
Mr Soros was found by the 2002 court to have had inside knowledge about the intentions of a group of super-wealthy French investors – known as the “golden grandads” – to make a bid for the bank. Although the bid failed, Mr Soros’s fund profited by buying shares before – and selling them after – the group’s intentions became public.
Mr Soros was fined €2.2 million, which was later reduced to €940,507 on appeal.
Mr Soros had based his initial appeal to Strasbourg on an argument that French insider-trading laws in the late 1980s were too vague for him to know he was in breach of them.
In its decision, the European court conceded that “the wording of the statutes was not always precise”.
But it said that Mr Soros, as a “famous institutional investor . . . could not have been unaware that his decision to invest . . . entailed the risk that he might be committing the offence of insider trading”.
Mr Soros’s lawyers lamented the court’s close decision, pointing out that even the former French market regulator, the Commission des Opérations de Bourse, had found France’s insider trading laws too ill-defined to warrant a civil case. – (Copyright The Financial Times Limited 2011)
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