Comparing the Law Related to Market Manipulation in Islamic Law and US Law

Abstract

The financial markets have been beset by large-scale market manipulations since its beginning. This article focuses on comparing the laws of market manipulation of the US and Islamic law and how Muslim countries get benefits from US regulation of financial markets. This will investigate market manipulation from US law and Islamic perspective. This article will present a comprehensive step review of the Islamic law regarding market manipulation. Also this article begins with a snapshot of financial markets in US law and the meaning of manipulation. Understanding more about the way the jurisprudence was designed to adapt to the existing laws and institutions of the Islamic Shariah will help place some of the unique features in Islamic law of financial markets. We will discuss the Islamic doctrine ḥisbah (حسبة‎) which means ‘accountability’ or a duty to ‘enjoin good and forbid wrong’ and how it benefits Islamic financial markets. Finally we will discuss whether principles of market manipulation, supplemented in Islamic law, have attained their purpose.