I think we all agree that fraud is a form of force by trickery. Well, sometimes the line between outright fraud and manipulation is blurred. Cooking the books or the such are obvious forms of fraud, but what about lying about a product's usefulness, or worse yet, hiding some dangerous side effects. I think the "hard sell" is sleezy, but regulating against that is going to far. Really I'm interested in where the line between fraud and manipulation is and how it should be handled.
Hayek would say it (meaning the law in a specific case) is something that must be discovered, and cannot be legislated. In other words, a judge must discover the expectations of the buyer and seller in order to determine any implicit contracts (such as social norms, etc) which might exist alongside explicit ones. Naturally, this is can be very hard to do, but implicit contracts are generally far more widely used than explicit ones. I'm not sure what he'd say about a situation where neither party adequitely understood what the other expected from the contract. I'd imagine this would simply be labeled as a mistake, with no one at fault.
In practice I think the difficultly of this sort of discovery would mean that parties who wished arbitration would expect the norms and rules of the court to overrule their own. This would give each party more well-defined standards of what "the law" is, so transactions could be carried out with less ambiguity.
But in a free market isn't the buyers faith in the seller an input to the price that would be negotiated and accepted by the buyer? I will pay the doctor that I trust and have a long history with more than a new doctor. I pay for confidence. Also, I return to the seller who is straight up. Fool me once, shame on you. Fool me twice, shame on me! Part of the buyers job is to ensure that they are not taken advantage of.
Merchants in a free market can still have a return policy. I will choose to buy from merchants who do, assuming that the price at that merchant is competitive.
I guess that the bottom line for me is that people need to be the first line of defense in protecting themselves. I believe that this will make manipulation less likely, because the buyer will be better informed. When the buyer is better informed, they have better defined the implicit and explicit terms of the "contract of sales" between the parties. This "contract of sales" then can be used to clearly deliniate fraud.
One hundred trillion Zimbabwe dollar note
What about the manipulation of data? Do Social Security recipients have a case for claiming fraud? How about savers in general, do artificially set interest rates force errors in calculation and buisness decisions?