- Health care company Ontrak Inc's Chief Executive Officer Terren Peizer resigned on March 2, the company said in a filing, a day after U.S. authorities charged him with insider trading.
Peizer sold more than $20 million of Ontrak stock between May and August 2021 while in possession of material non-public negative information related to the company's largest customer, authorities said. The charge marks the first criminal case involving the use of a special trading plan designed to help shield executives from such charges. Executives can use trading plans under rule 10b5-1 as a defense against insider trading charges by planning to sell shares in advance at predetermined times.
But the prearranged stock selling programs have come under criticism in response to a growing body of academic research indicating some executives have used them for suspiciously well-timed trading. Brandon LaVerne, who has been the company's chief operating officer since 2022, will be the interim chief executive.Reuters Health Information © 2023
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