Title: SEC Charges Citron Research and Andrew Left in $20 Million Scheme: What Investors Need to Know
In a shocking turn of events, the U.S. Securities and Exchange Commission (SEC) has filed charges against renowned short seller Citron Research and its founder, Andrew Left, for their involvement in a $20 million fraudulent scheme. The SEC alleges that Citron used false and misleading statements to defraud investors by manipulating the market with its recommendations.
Citron would recommend taking short or long positions in certain companies on its website and social media accounts, causing an average market move of over 12% following a recommendation. However, after making these recommendations, Citron would go against them by buying stock after recommending to sell and vice versa.
The SEC’s complaint also reveals that Citron tried to portray itself as an independent research firm but had compensation agreements with hedge funds like Anson Funds Management. The charges seek disgorgement, a penny stock bar for Left, civil monetary penalties, and other remedies.
Separately, the U.S. Department of Justice has charged Left with engaging in a securities fraud scheme and multiple counts of securities fraud. These charges carry hefty penalties, including up to 25 years in prison for the securities fraud scheme.
In conclusion, investors should be wary of following recommendations from sources like Citron Research and conduct thorough research before making investment decisions. It is crucial to be aware of the risks involved in the market and avoid falling victim to fraudulent schemes that can have severe legal consequences.