Andrew Left, the founder of Citron Research, a short-selling financial research firm, has entered a not guilty plea to several securities fraud charges filed against him on July 26.
In a 40-minute hearing at a federal court in Los Angeles, Judge Rozella Oliver set a $4 million unsecured bond and a $1 million collateralized bond for Left, who is required to post the collateral by August 5, as per a Bloomberg report dated July 29.
During the hearing, Left was ordered to surrender his passport.
This decision followed U.S. Assistant Attorney Brett Sagel’s successful argument that Left posed a flight risk due to his substantial assets, which include overseas property.
“He can walk out of this country and live a very luxurious life,” Sagel noted.
Furthermore, Left’s financial activities are now restricted; he cannot engage in transactions exceeding $100,000 without special permission, and his trading activities are limited.
Throughout the proceedings, Left, with hands cuffed, responded to the judge’s questions mostly with “yes” or “no” answers.
His trial is scheduled for September 24.
The charges against Left were brought by both the U.S. Securities and Exchange Commission (SEC) and the Department of Justice.
They accuse him of profiting $16 million through misleading stock recommendations, a practice referred to as “bait and switch.”
The SEC alleges, “Left bought back stock immediately after telling his readers to sell, and he sold stock immediately after telling his readers to buy.”
Left’s attorney, James Spertus, has criticized the case as “defective,” stating that Left had no obligation to disclose his personal trading plans.
Spertus added that Left would not accept a plea deal, as it would imply wrongdoing.
The case is part of a broader investigation into the relationship between hedge funds and short-seller research firms.
Citron, known for its critical stance on the cryptocurrency industry, previously advised shorting Coinbase stock after an exchange outage.
Similarly, other short-seller firms like Culper Research and Kerrisdale Capital have targeted crypto companies, critiquing their business practices and valuation.
To submit a crypto press release (PR), send an email to sales@cryptointelligence.co.uk.
