Marco Ventoruzzo in the American Debate on Insider Trading

In the US insider trading has been regulated earlier than in Europe and, until recently, it has been more aggressively and successfully enforced. But in the American tradition it is a crime entirely defined by common law – an accumulation of cases and judicial precedents that date from the 1960s - and the recent decision by a US Court of Appeals to overturn the convictions of two Wall Street traders has reopened a long lasting debate about the opportunity to define insider trading by a law approved by the Congress.

Thanks to his comparative studies on insider trading in the US and in Europe, Marco Ventoruzzo (a professor with a dual appointment at Bocconi's Department of Legal Studies and Penn State's Dickinson School of Law) is one of the protagonists of this debate.

James B. Stewart, a journalist-cum-academic acknowledged with a Pulitzer Prize for Explanatory Journalism, featured Ventoruzzo in a New York Times article titled Delving into Morass of Insider Trading, along with Columbia's John C. Coffee Jr, University of North Carolina's Thomas Lee Hazen and UCLA's Stephen M. Bainbridge.

"(The American) approach is much too complex and leads to bizarre outcomes", Ventoruzzo said. "There are all these hoops prosecutors have to jump through to find a violation. The European approach, by contrast, is much simpler: if you have material, inside information, you can't trade on it, period. The idea you shouldn't be allowed to trade when you have confidential inside information is widely accepted in Europe".

The background for the interview has been provided by a paper forthcoming in European Company and Financial Law Review, titled Comparing Insider Trading in the United States and in the European Union: History and Recent Development.

In his paper Ventoruzzo argues that since the US Supreme Court abandoned the "equal access to information" theory in favor of a theory of insider trading based on fiduciary duties, "an overly complex web of rules developed through an intricate web of case law and SEC regulations. Comparatively speaking, the European approach, based on the equal access to information theory, is more clear, easy to apply and broad".

In another paper (Do Market Abuse Rules Violate Human Rights? The Grande Stevens v. Italy Case), forthcoming in European Business Organization Law Review, Ventoruzzo analyzes the implications of a recent European Court of Human Rights' decision and compares it with corresponding US case law.