Andrew Left

Andrew Edward Left (born July 9, 1970 in Detroit Michigan) is an activist short seller, author and editor of the online investment newsletter Citron Research, formerly StockLemon.com.^[1][2]

Citron Research

Founded in 2001, StockLemon.com changed its name to Citron Research in April 2007.^[3] Citron Research provides short-focused stock market commentary. Left researches and short sells companies he believes to be engaged in fraud, have been suspiciously promoted, or have been mistakenly overpriced by the stock market.^{[4][5][6][7][8][9]}

The Financial Times and other business publications have reported on Left’s predictive accuracy.^[9][10] A number of companies he has reported on were subsequently subjected to regulatory or law enforcement intervention, often resulting in steep drops in stock prices.^[2] Left has been open in interviews that Citron makes its revenue through the short sale of stocks, and that he has sold stocks before criticizing companies online, citing that it is a legal practice.^[11][12]

Left has been featured as a commentator in a variety of media outlets, including Barron’s,^[13] CNBC,^[14][15][16] and CNNMoney.^[17] Citron Research's report predicting the finding of financial fraud at Longtop Financial Technologies is cited in a 2011 Harvard Business School Case Study.^[18] In 2012, he was a panelist at Columbia Business School's China Business Conference.^[19]

Citron's reports on Chinese companies

Left's reports cover companies in the US and China; in a five-year period, Citron Research published reports on 18 Chinese companies, 16 of which experienced a drop in stock prices, with 15 of them experiencing drops of over 70%.^[12] This has caused a collective of Chinese business leaders, including Qihoo 360 CEO Zhou Hongyi (a company that has been targeted by Left), launch a site called CitronFraud.com.^[20] Left sent a legal notice to the 60 Chinese executives involved, seeking an apology, and told Tech In Asia that he's consulting with lawyers and considering legal action in response.^[21] Qihoo 360 has also threatened to take legal action against Citron, as well as former Google China chief Kai-Fu Lee, now the chairman and CEO of Innovation Works.^[10][22]

Nu Skin Enterprises Report

In 2012, Citron Research was the first to question the legality of operations by Nu Skin Enterprises on mainland China, stating that the company was operating an illegal multi-level marketing scheme.^[23] Citing accounts from "undercover customers," Left posted reports that Nu Skin employees were promoting a pyramid-sales model to them, in violation of Chinese law.^[24] The company denied the claims, with Nu Skin's CFO stating that its China operations were "kosher."^[25]

Initially, the report drew some criticism, with Taesik Yoon of Forbes citing that, Citron had alleged that Nu Skin was practicing illegal multilevel marketing in China, no investigation had taken place.^[26] In January 2014, the Chinese government announced that they were investigating the company in response to the allegations, causing the company's stock to drop almost 50 percent over two days.^[27] The company, based in Provo, UT and linked to former presidential candidate Mitt Romney, continued to deny the claims.^[28][29][30] The accusations were echoed in People's Daily newspaper, the official newspaper of the Chinese Communist Party.^[31] In February 2014, Saxena White P.A. filed a securities fraud class action lawsuit in the United States, alleging the company had failed to disclose “its fraudulent sales practices and non-compliance with Chinese laws and regulations.”^[32]

Lawsuits

In response to the statements made in reports by Citron Research, Left has been the target of litigation multiple times. In a 2011 interview he claimed that he had never lost a case in the U.S.^[12]

YP.Net

In 2004, YP.Net Inc., filed a defamation lawsuit in Arizona federal court against StockLemon after the website published a critical report on the company.^[33] The case was dropped in August of the same year, following YP.Net's CEO being charged with conspiracy, money laundering and wire fraud.^[34][35]

iMergent

In 2005, iMergent Inc., filed a $15 million libel and defamation suit against StockLemon in Los Angeles Superior Court following the site's report on the company.^[36] The suit was dismissed in 2006.^[37] The company was later the target of class action lawsuits that alleged accounting irregularities and deceptive sales practices.^[38]

GTX Global

In 2005, GTX Global Corp filed a suit against Left, charging claims of trade libel, intentional interference with prospective economic advantage, securities fraud under California law, securities fraud under federal law, and conspiracy.^[39] The suit was dismissed in 2007.^[40] GTX Global CEO David Hagen was later convicted of securities fraud, wire fraud, and money laundering.^[41]

Regulatory interventions

Since 2001, more than 50 companies covered by Left have become targets of regulatory interventions.

Criticism

In 1998, Left was found by the National Futures Association to have “made false and misleading statements to cheat, defraud or deceive a customer", and disbarred for three years.^[126]

In 2002, his then employer Detour Media sued Left for "fraud and deceit, negligent misrepresentation, breach of fiduciary duty and unlawful monetary conversion".^[127] He was ordered to pay $26,445.62 compensation.^[128]

In 2010, Left was briefly arrested in Florida in relation to a petty dispute with a drycleaner. The charges were subsequently dropped.^[129]

References

External links

• Citron Research