Teladoc Health (TDOC) shares were fluctuating Wednesday as the company faces allegations from short seller Blue Orca Capital that its BetterHelp platform incentivized therapists to use artificial intelligence in mental health therapy.

The use of AI on the platform contradicted the company's own stance, as its website warns that AI-driven therapy dehumanizes patients, the short seller said.

According to the short seller's report, therapists were incentivized to use AI because they were paid bonuses depending on how much they wrote when responding to patients.

As a result, long generic messages that might originate from ChatGPT, for example, paid better than shorter, thoughtful messages, the short seller alleged.

"As more patients take to social media and other online platforms to allege that their BetterHelp therapist used AI or a chatbot, we think that this will only accelerate falling BetterHelp profits and plummeting user growth" Blue Orca Capital said in the report.

Additionally, the short seller alleged that Teladoc was "engaging in questionable accounting maneuvers" to inflate its books, and that it generated "far less" profit and cash than it led investors to believe.

Teladoc did not immediately respond to a request for comment from MT Newswires.

The stock was volatile in recent trading, swaying back and forth 2% from its previous day closing price.

Price: 13.14, Change: +0.03, Percent Change: +0.19