According to Foresight News , the U.S. Securities and Exchange Commission (SEC) and the Department of Justice simultaneously filed charges against Andrew Left and his company Citron Capital on Friday, alleging that they were involved in a multi-million dollar fraud scheme. The SEC accused Left and Citron Capital of issuing false and misleading stock recommendation statements between 2018 and 2020.
On at least 26 occasions, Left used Citron’s newsletter to recommend long or short positions in stocks that matched his own holdings, which then resulted in an average stock price move of 12%. The SEC said Left and his company would then do the opposite and profit from the new stock price movement, accumulating profits of about $20 million. Kate Zoladz, director of the SEC’s Los Angeles regional office, said Left exploited readers’ trust and induced them to trade based on false information so that he could quickly reverse course and profit from the price movement. The SEC is seeking to impose various financial penalties on Left and Citron, including conduct bans, prohibitions from serving as an executive and director, and prohibitions from participating in penny stock trading. The Justice Department’s allegations are similar, but estimate the proceeds of the fraud at $16 million and could result in criminal charges for Left.
