When Chris Stern was unceremoniously shown the door at Oxygen Biotherapeutics last month, the biotech icily declined comment, other than noting that Stern was being dismissed for cause. Now in a new security filing, the developer has spelled out charges that the CEO had fraudulently doctored up an impressive resume while scheming to use his position at the company for personal gain.
When Chris Stern arrived at the Morrisville, NC-based Oxygen Biotherapeutics ($OXBT), his resume boasted an impressive PhD from Trinity University as well as a teaching post at St. Gallen Business School. But when the biotech's audit committee started checking the facts, the doctorate turned out to be from the unaccredited Trinity College. And the teaching post was at St. Galler, not Switzerland's Gallen. Another revelation: The committee claims that Stern lined his own pockets, leveraging his position three years ago to get a service provider to give him warrants to purchase shares in Oxygen. Oxygen struck a consulting pact with the service provider "for the purpose of disguising payments to Fiona for commissions on the sale of our securities to U.S. persons," according to a report in MedCityNews.
Stern didn't go quietly, however. The SEC documents also detailed an angry e-mail in which he wrote: "I am very surprised at this. I don't agree and do not accept my termination, and I request this filing be stopped until the attorneys have talked. And then it needs to be changed."
The audit committee, though, chastised Stern for what it called inconsistent and conflicting information during its investigation. Oxygen says that it has since put a new system in place to make sure the CEO snafu doesn't happen again.