The SEC has charged Citron Research and Andrew Left with cryptoasset fraud on the GameStop platform

The regulator accused Left of willfully deceiving subscribers by publishing false and misleading NFT trading recommendations on the platform of gaming retailer GameStop (NYSE:GME).

The SEC's complaint alleges that Left used Citron Research's official website and related social media platforms at least 26 times to publicly recommend to its subscribers to take long or short positions in digital assets, and then traded against them.

“Andrew Left used the trust of unsophisticated investors for self-serving purposes to induce them to trade on false market signals and then quickly change the direction of trades on the GameStop platform to profit from price movements. We uncovered these alleged spoofing tactics, which generated approximately $20 million in illicit profits for Left and his firm,” said Kate Zoladz, director of the SEC's Los Angeles Regional Office.

In a parallel lawsuit, the Justice Department's Fraud Section and the U.S. Attorney's Office for the Central District of California announced their own investigation into the allegations against Andrew Left.

Earlier, US gaming retailer GameStop warned users that it was ending support for non-interchangeable tokens on its NFT platform due to regulatory uncertainty.