Soros Found Guilty of Insider Trading
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Billionaire investor George Soros was found guilty of insider trading by a French appeals court, confirming a 2002 conviction and threatening to prolong a 16-year legal affair.
The Paris appeals court ruled that Mr. Soros’s 1988 purchase of Societe Generale SA shares with the knowledge that it was a takeover target broke French insider trading laws. Odile Faivre, head of the court’s three-judge panel, read out the verdict. Mr. Soros wasn’t present in the room.
The verdict marks the only legal stain on Mr. Soros’s 40-year investing career. It comes at a time when Soros, 74, is no longer actively investing and has turned his attention to political and charitable activities. Soros spent $26.5 million in a failed effort to defeat President George Bush in last year’s U.S. presidential elections.
“Mr. Soros maintains his innocence,” said Michael Vachon, his spokesman. “He will appeal this case. He is confident that he will ultimately be vindicated in this matter and that justice will be served.”
Vachon said Mr. Soros will appeal the case.
Mr. Soros has two options for appeal. At the Court de Cassation, his lawyers can’t re-argue the facts of the case. They can only assert that the law was misinterpreted.
He could also file a complaint at the Strasbourg, France-based European Court of Human Rights, arguing that the 14 years it took to bring the case to trial violated his right to a speedy trial.
Mr. Soros testified for two hours February 10 at the appeal court’s hearing. Under questioning by Judge Jean-Baptiste Avel, he said he didn’t consider the information that led him to buy Societe Generale shares to be confidential.
“I knew it wasn’t known to the general public, but I didn’t consider it privileged,” he told the court.
Mr. Soros used confidential information to trade shares of the French bank Societe Generale during a takeover battle in 1988, a Paris court had ruled after a weeklong trial in 2002. Mr. Soros was ordered to pay back his 2.2 million euros in gains. That amount was worth $2.3 million at the time of the judgment, and is now worth $2.9 million. Because of the 14 years it took to bring the case to court, prosecutors hadn’t asked for punitive damages.
