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Christian Longo (James Franco), an Oregon man whose wife and three children have been discovered murdered, is arrested by police in Mexico. There he had been identifying himself as a reporter for the New York Times named Michael Finkel.
In New York City, Finkel (Jonah Hill) is an ambitious and successful reporter. He is confronted by his editors about a story he has written and has featured on the cover of the New York Times Magazine. They accuse him of using a composite character as the focus of his story, a violation of basic reporting principles. Finkel briefly attempts to defend his actions, but he is dismissed. He returns home to his wife (Felicity Jones). He struggles to find work as a journalist but is unsuccessful due to his public dismissal from the Times.
Finkel is contacted by a reporter for The Oregonian, who is seeking his opinion on Christian Longo's theft of his identity. Finkel, who was not aware of Longo's case at all, is intrigued. He arranges to meet with Longo in prison. During their first conversation, Longo claims that he has followed Finkel for his entire career and always admired his writing. Longo agrees to tell Finkel his side of the crimes he is accused of, in exchange for writing lessons and Finkel's promise not to share their conversations until after the conclusion of the murder trial.
Finkel becomes increasingly absorbed with Longo, who is evasive about his guilt. Convinced that the story will be redemptive, Finkel visits Longo in prison and corresponds with him for several months. Longo sends Finkel numerous letters as well as an eighty-page notebook entitled "Wrong Turns", which contains what Longo describes as a list of every mistake he has made in his life. Finkel begins to recognize similarities between Longo and himself, their handwriting and drawing, Longo's letters and Finkel's personal journals. As the trial approaches, Finkel grows increasingly doubtful that Longo is guilty of the murders, and Longo informs Finkel he intends changing his plea to not guilty.
In court, Longo pleads not guilty to two of the murders, but pleads guilty to the murder of his wife and one of his daughters. Finkel confronts Longo, who claims that he can not share everything he knows because has to protect certain individuals, whom he refuses to name. Greg Ganley (Robert John Burke), the detective who tracked Longo down and arrested him, approaches Finkel. He claims that Longo is an extremely dangerous and manipulative man. He tries to convince Finkel to turn over as evidence all of his correspondence with Longo. Finkel refuses and Ganley does not press him for an explanation.
At the trial, Longo takes the stand and describes his version of the events in detail. He claims that, after an argument with his wife about their financial situation, he had come home to discover two of his children missing, one of his daughters unconscious, and his wife sobbing, saying that she put the children "in the water". Longo says that he strangled his wife to death in a blind rage. He says he thought his other daughter was dead at first, but then realized she was still breathed and strangled her as well because she was all but dead. Finkel's wife, Jill, watches Longo's testimony.
As the jury deliberates, Jill visits Longo in jail and tells him that he is a narcissistic murderer who will never escape who he is.
Longo is found guilty of all charges and sentenced to death. After he is sentenced, he winks at Finkel. Finkel, to his shock and rage, realizes that Longo has been lying throughout their conversations, using him in order to make his testimony more believable. A short time later, Finkel meets Longo on death row. Longo tries to convince Finkel that he discovered his wife strangling their daughter and then blacked out, so that he has no memory of the murders. Finkel angrily tells Longo that he will not believe any more of his lies and will warn the judge when Longo appeals his sentence of Longo's manipulative nature. Longo retorts by pointing out the success Finkel has had with his book about their encounters, leaving the reporter shaken.
Finkel reads a section of his book, entitled True Story, at a promotional event in a bookstore. Taking questions from the audience, he imagines Longo standing in the back of the room. Longo says that, if he has lost his freedom, Finkel must have lost something as well. Finkel is unable to respond.
Title cards reveal that although Finkel never wrote for the New York Times again, Longo has had several of his pieces written from death row published, including the New York Times, and that Finkel and Longo still talk to each other on the first Sunday of every month.