US Probes Insider Trading in Prearranged Executive Stock Sales

US authorities are investigating whether executives have been gaming prearranged stock-sale programs designed to thwart the possibility of insider trading.

The Justice Department and Securities and Exchange Commission are using computer algorithms in a sweeping examination of preplanned equity sales by C-suite officials, according to people familiar with the matter. Investigators are concerned that some people are manipulating the stock-sale programs, which are intended to shield executives from misconduct allegations by letting them schedule transactions in advance and on preset dates.

Critics say the plans have many possible loopholes. There’s no cooling-off period, so executives may adopt one and then ...