Zenefits CEO resigns amid compliance problems
Fast-growing San Francisco software startup Zenefits said that Parker Conrad has resigned as chief executive officer, citing “inadequate” processes and regulatory compliance.
Zenefits hired an accounting firm in December to conduct a review of the company’s licensing procedures, Sacks wrote in a memo to employees.
Josh Stein, a former federal prosecutor and vice president of legal, will oversee the review as chief compliance officer.
Conrad, a co-founder of the company, has also resigned from the board of directors of the company that attempted to shake up the health insurance brokerage industry.
The company makes software that is intended to streamline the way small businesses buy health insurance for their employees.
According to BuzzFeed, Zenefits employed unlicensed brokers to sell insurance to customers, resulting in scrutiny from regulators and the undoing of many of its sales.
Established brokers in many states complained to state regulatory bodies, according to tech news site ReCode.
Peter Thiel, a co-founder of PayPal who is now an investor at Founders Fund, Antonio Gracias of the investment firm Valor Equity Partners and William McGlashan Jr. of TPG Growth.