Textura shares take hit after short-seller alleges fraud

SHARE Textura shares take hit after short-seller alleges fraud

Short-seller Citron Research accused software maker Textura Corp of lying to the Securities and Exchange Commission about the involvement of Chief Executive Patrick Allin in a “pump-and-dump” scheme, Reuters reports.

Deerfield-based Textura makes project management softare for the construction industry. The company went public this summer. The company’s share price was off sharply Thursday.

Someone who carries out a pump-and-dump scheme attempts to boost the price of a stock through recommendations based on false or misleading statements before they sell shares.

Short sellers such as Citron make money when the stock price of a company drops. They sell borrowed shares in the hope of buying them back at a lower price and return them to the lender, and gain from the difference in price.

h/t: chicagobusiness.com

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