Andrew Left found guilty of securities fraud by American jury
An American jury convicted investor Andrew Left of securities fraud after 15 days of trial. Sentencing will be handed down on 31 August.
Andrew Left, founder of Citron Research, convicted of market manipulation
An American jury declared investor Andrew Left guilty of securities fraud on Monday, the Department of Justice announced, according to boursorama.com. The verdict deals a severe blow to the community of activist short-sellers, who for years have targeted listed companies in the United States and abroad by accusing them of overvaluation or fraud.
After two days of deliberations, jurors found Left guilty of participation in a securities fraud scheme and 12 of 16 other charges related to specific transactions. They acquitted him of four counts. Sentencing is scheduled for 31 August.
Stock recommendations used as a manipulation tool
American authorities indicted Left in July 2024, accusing him of manipulating the market and defrauding investors through false statements about his positions in several companies, including Nvidia and Tesla. According to the indictment, he gained at least 20 million dollars through this scheme.
Prosecutors argued that Left, 55, exploited his influence on social media and his appearances on continuous news channels to publicly promote his positions before secretly liquidating those same positions to profit from ephemeral price fluctuations. For the mechanism to work, individual investors had to believe he was acting consistently with his statements, they argued. Several of these investors testified at trial, claiming they suffered losses as a result of Left's recommendations.
Prosecutors also alleged that Left had alerted speculative funds before making his positions public, in exchange for remuneration, and that he concealed this coordination through false invoices.
A 15-day trial and a defence based on freedom of expression
During the 15 days of hearing, the defence argued that Left genuinely believed in his stock recommendations. In an approach described by observers as unusual and risky, Left himself took the stand to explain his investment decisions.
Left runs Citron Research and has been part, for more than a decade, of the most visible group of activists specialising in short-selling — a practice that consists of betting on a security's decline, though Left has also taken long positions. He had pleaded not guilty and denied all allegations.
On Monday, following the announcement of the verdict, Left published a message on the Citron Research X account: "No one ever said I lied… There were no false statements. We disagree with the jury and this does not end here. We will continue to fight for freedom of expression, honesty and equal opportunity, which form the foundation of this country. This is not over." Left's lawyer did not respond to requests for comment.
A legal theory contested by experts
Some legal experts have argued that the Department of Justice's approach was excessive. Short-sellers have long defended themselves by invoking rights guaranteed by the First Amendment of the American Constitution, arguing that their analyses constitute a form of protected speech. Investors, experts also pointed out, are free to modify their positions.
Prosecutors nevertheless based their case on Left's private messages and evidence of transactions conducted behind closed doors to demonstrate that his true intentions were to manipulate the market rather than to share good-faith investment convictions.
Left faces a maximum sentence of 25 years in federal prison for the charge of organised securities fraud, and up to 20 years per additional charge retained by the jury.
Source: Google News MA — Crime (fr)