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Oak Street Investor Sues, Alleging Kickbacks, Insider Trades (1)

Nov. 15, 2022, 9:08 PMUpdated: Nov. 15, 2022, 9:29 PM

An investor sued Oak Street Health Inc.'s co-founders, claiming they ignored the rampant kickbacks and bribes at the heart of its business model while selling hundreds of millions worth of stock at inflated prices.

The shareholder derivative lawsuit targets Oak Street’s three founders, chief financial officer, and nine other directors. It accuses the board of looking the other way while management adopted a “systematic strategy” of paying illegal commissions for patient referrals by recruiters and health-care providers.

Although compliance with false claims and anti-kickback laws is mission-critical for a Medicare contractor, the board “utterly failed to institute any reporting or ...