Nothing about my statement requires arbitrage to be reducible to fraud in the average case. "Arbitrage" can be a euphemism for fraudulent activity even if most arbitrage is not fraudulent.
The heart of the matter is good faith. "Fraud" is a crime created to capture activity in bad faith with respect to the property regulation. The importation here might be legal, but there is a demonstrable lack of good faith that justifies calling it fraud.
