Market manipulation in the stock and securities markets can result in financial losses for those who are unable to influence the market. The present article aims to understand and identify the foundations of government liability related to market manipulation in the stock and securities markets within the legal systems of Iran and the United States. The question of this article is: under what conditions might the state be held civilly liable for market manipulation in the stock market and securities in the legal systems of Iran and the United States, and what legal foundations support this liability? The findings indicate that the foundations include the identification of fault, the establishment of causation, strict liability, and the concept of state responsibility, which can be considered in both legal systems.

In Iran, the sources of understanding government liability are found in the Constitution, the Islamic Penal Code, and the Civil Liability Act, with Article 11 of the Civil Liability Act being the most relevant concerning the compensation for government interference in the stock and securities markets. However, the legal gap in the stock market and the lack of clear guidelines for identifying government manipulation and interference pose significant legal challenges in Iran, making it difficult to determine government liability for compensating stock market losses in case of such interference. In contrast, under the U.S. legal system, Section 9 of the Securities Exchange Act of 1934 prohibits the government from any form of market manipulation. The research method in this article is analytical-comparative.