By Sam Jones in London and Stanley Pignal in Brussels
October 6, 2011 9:34 pm
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 in a 4-3 decision by the Strasbourg-based court is the latest twist in a nine-year battle by the 81-year-old Mr Soros to clear his name following his conviction in France in 2002.
The French criminal case hinged on trades that the Hungary-born investor had executed 14 years earlier in the stock of Société Générale that reaped his hedge fund, the Quantum Fund, $2.9m in profits.
Mr Soros was found by the court in 2002 to have had inside knowledge about the intentions of a group of super-wealthy French investors – the “golden granddads” – to bid for the bank.
Although the bid failed, Mr Soros’s fund profited by buying shares before – and selling after – the group’s intentions became public and resulted in a spike in SocGen’s share price.
Mr Soros was fined €2.2m (£1.9m), later reduced to €940,507 on appeal.
At the time, Mr Soros described the guilty verdict as a “gift to my enemies”.
He is now left with one final, unlikely, chance to rid himself of his conviction: an appeal to the grand chamber of the ECHR. Such appeals are only heard on an “exceptional basis”, according to the court’s rules.
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 that he was in breach of them.
In its decision, the ECHR 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”.
Mr Soros’s lawyers lamented the ECHR’s close decision, pointing out that even the former French market regulator, the Commission des Operations de Bourse, had found France’s insider trading laws too ill-defined to warrant a civil case.
“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.
“The opinion of the regulatory authority is an irrebuttable presumption as to the lack of clarity of the law,” Mr Soffer said.
Copyright The Financial Times Limited 2011
No comments:
Post a Comment