Wire fraud: Theranos founder Elizabeth Holmes faces 20 years in prison for defrauding investors.
Elizabeth Homes, the former CEO and founder of Theranos, has been found guilty on charges of wire fraud and conspiracy to commit wire fraud. A 20-year sentence is possible for Holmes if she is found guilty of cheating investors in a blood testing company.
More than three years after she was first accused and forced to resign as CEO in 2018, the jury returned its decision following a trial that lasted several months. Holmes was convicted of four of the 11 charges against her: conspiracy to deceive investors and three counts of wire fraud against individual investors.
One count of conspiracy to cheat patients, two counts of fraud against investors and one count of wire fraud originating from advertising Theranos placed in Arizona were all found not guilty. There was no verdict on three additional counts of wire fraud because the jury couldn’t agree on a resolution. It was argued by the defense that Holmes was an inexperienced businesswoman during the trial.
During the opening statements, one of Holmes’ attorneys stated “Elizabeth Holmes pushed herself to the bone for 15 years attempting to make lab testing more accessible.” It’s not a crime to fail.
At the trial, Holmes said she had been told to preserve the company’s “trade secrets” because she didn’t want to mislead investors or the public. According to The New York Times, she “spent the majority of her testimony arguing that other Theranos employees were accountable for the company’s shortcomings.”
According to the prosecution, Holmes was accused of concealing severe problems in the company’s technology from investors. Additionally, patients who had been misdiagnosed with a miscarriage and an Arizona lady who obtained an erroneous HIV test result spoke.
Even many outside of Silicon Valley have been fascinated by Holmes’ narrative. Theranos had a board of directors that included two former Secretaries of State, Henry Kissinger and George Shultz and was valued at over $9 billion at its height.
When Holmes founded the firm, she was frequently featured on magazine covers and likened to Steve Jobs and other famous founders. There were many investigations and lawsuits brought against Holmes and former COO Ramesh “Sunny” Balwani after former Wall Street Journal writer John Carreyrou first reported on Theranos’ technical difficulties in 2015.
Holmes said in court that her relationship with Balwani was abusive. The trial for Balwani will begin in February. Holmes has been portrayed countless times in film, television and video games.
Carreyrou’s best-selling book, Bad Blood, sparked an HBO documentary and a flurry of podcasts detailing Theranos’ meteoric ascent and eventual demise.
Amanda Seyfried is poised to play Holmes in a new miniseries that will premiere on Hulu in March. Apple also just acquired the film rights to Bad Blood starring Jennifer Lawrence.It’s not yet known when Holmes will be sentenced, but she may face up to 20 years in jail with bond set to $500,000.
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