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Textura shares fall after short-seller Citron alleges fraud

Thursday, 26 Dec 2013 | 11:48 AM ET

Dec 26 (Reuters) - 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.

Textura shares slid as much as 15 percent on Thursday morning.

"Textura's CEO failed to disclose personal involvement in Patron Systems Inc, a notorious OTC stock, pumped and dumped by perpetrators now in Federal prison," the Citron report said.

Perpetrators of a pump-and-dump scheme attempts to boost the price of a stock through recommendations based on false, misleading or greatly exaggerated statements. They then sell their positions after the hype has pushed the share price.

Patron Systems is a penny stock with a market value of $45,000.

Textura makes on-demand project management software to help commercial construction businesses. (http://link.reuters.com/hes65v)

The company, which went public in June, did not immediately answer calls or reply to email requests for comment.

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.

The Deerfield, Illinois-based company's shares were down about 14 percent at $32.52 on the New York Stock Exchange.

(Reporting By Aditya Kondalamahanty in Bangalore; Editing by Joyjeet Das)

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