Former Silicon Valley star Elizabeth Holmes sentenced to prison
Failed start-up founder Elizabeth Holmes has been sentenced to more than 11 years in prison for a fraud she committed by tricking investors into the effectiveness of a blood-testing company.
Holmes was sentenced on November 18 by Judge Edward J. Davila of the United States District Court to 135 months in prison, plus 3 years of supervised release.
The former businessman, who raised $945 million for Theranos, must surrender by April 27, 2023.
She plans to appeal.
She was convicted in January after defrauding investors for several years, claiming that the company could detect a variety of diseases from just a few drops of blood. Holmes was found guilty of four of the 11 counts of fraud and conspiracy.
Holmes read a statement to the judge and cried as she said: “I am devastated by my failures. I felt deep pain for what people went through because I let them down.”
Her parents and her partner Billy Evans were present at the sentencing.
Holmes extended her apology beyond misdiagnosed patients, including her former employees and investors. She claims the scam happened because she managed to achieve her goal too soon. Theranos was founded in 2003.
No questions from investors
In 2016, the Centers for Medicare and Medicaid Services banned Holmes from owning a blood-testing company for two years and drug store giant Walgreens. (WBA) – Get a free report ended the partnership by closing blood collection centers.
The 38-year-old sought a lenient sentence of 18 months of house arrest while prosecutors asked for a longer prison sentence of 15 years, plus $804 million in damages for 29 Investors. Under federal sentencing guidelines, Holmes could face a maximum sentence of 20 years in prison for the scale of wire fraud from her sentence. The probation officer assigned to the case recommends nine years
In January, Holmes did not react when the verdict was read, according to media coverage of the case.
A jury convicted her after seven days of deliberation. She was found guilty of one count of conspiracy to commit wire fraud against Theranos investors and three counts of wire fraud against an investor. She was acquitted on four other counts – the jury found her not guilty on one count of conspiracy to commit wire fraud against patient Theranos and three counts of fraud against a patient core. There is no verdict on the remaining three charges.
Holmes came to prominence in an era when investors raced to enter tech deals that promised superior returns, avoiding the lack of independent validation in the biotech industry.
Sunny Balwani, Holmes’s former business partner and partner, is also guilty in case.
Ramesh “Sunny” Bałwani, who served as president and COO at Theranos, was convicted by a federal jury in July of all 12 counts of fraud – 10 counts of wire fraud and two counts of negative conspiring to commit fraud through power lines.
He faces a sentence of up to 20 years in prison, as well as a possible fine of up to $250,000 and a claim for investors.