Citron Research Founder Convicted Over Market Manipulation Plot

Citron Research founder Andrew Left was found guilty of securities fraud for manipulating stocks while trading opposite to his public calls.

Andrew Left, the founder of Citron Research, has been found guilty of securities fraud. A federal jury in Los Angeles convicted the 55-year-old stock analyst on 13 counts. 

The charges stem from a years-long scheme to manipulate stock prices. 

Left used his media platform to deceive investors while secretly trading against his own recommendations. He earned at least $21 million in illicit profits through the scheme.

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How Left Used Citron Research to Manipulate Markets

Left ran Citron Research as an online investment commentary platform. He published stock recommendations through a website and an X account, formerly Twitter. 

His commentary frequently included target prices and implied trading positions. Investors trusted these positions and moved their money accordingly.

Behind the scenes, Left was doing the opposite. Before publishing any recommendation, he built long or short positions in the target stock. 

He then released commentary with sensationalized headlines designed to move share prices quickly. Once prices moved, he closed his positions for quick profits. The target prices he made public had little to do with when he actually sold.

Left often used short-dated options contracts that expired on the same day he published commentary. This allowed him to maximize gains from the brief, sharp price swings his posts triggered. 

According to the US Attorney’s Office for the Central District of California, Left structured trades this way repeatedly between March 2018 and October 2023.

He also concealed financial relationships with hedge funds. Left reportedly lied to law enforcement, claiming Citron had never received compensation from or coordinated with a hedge fund ahead of publishing commentary. Evidence at trial suggested otherwise.

The Nvidia Trade That Illustrated the Scheme

One specific example emerged prominently during the 15-day trial. 

In November 2018, Left messaged a portfolio manager about Nvidia. He wrote that they could “destroy” the narrative around the stock and suggested assembling analyst notes to push a bullish case. That same morning, Left took financial positions in Nvidia, including short-dated call options.

He then posted on Citron’s Twitter account, calling Nvidia a favorable buy. He set a public target price of $165, while the stock traded near $143. 

Major media outlets picked up the tweet. The stock moved sharply upward, climbing into the $150 to $151 range.

Less than two hours after posting, Left sold all his pre-tweet Nvidia positions. He made at least $960,000 on that single trade. 

The stock closed at a high of $154 that day before falling back to $144 the next. His public target of $165 was never reached, nor was it ever his actual exit point.

Verdict, Sentencing, and What the Conviction Means

The jury found Left guilty of one count of a securities fraud scheme and 12 individual counts of securities fraud. It acquitted him on four additional counts tied to trades in four other companies. US District Judge Virginia A. Phillips set a sentencing hearing for August 31.

Left faces up to 25 years in prison for the scheme count. Each securities fraud count carries a maximum of 20 years. First Assistant US Attorney Bill Essayli made clear after the verdict that the conviction was not about short-selling as a practice. 

According to Essayli, Left was convicted for making misleading public statements to move stock prices for personal gain, not for legitimate research-driven trading.

The FBI and the US Postal Inspection Service led the investigation. FINRA’s Criminal Prosecution Assistance Group also provided substantial support. 

Prosecutors from the Major Frauds Section, the Transnational Organized Crime Section, and the Justice Department’s Criminal Division’s Fraud Section handled the case jointly.

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