Elizabeth Holmes, the founder of Theranos, has been proven guilty of fraud by a US jury
A US jury convicted Theranos founder Elizabeth Holmes guilty of four charges of conspiracy to deceive investors in the blood testing business on Monday.
Holmes pleaded guilty to scamming three other investors and conspired to do so. In addition to the conspiracy allegation, she was acquitted of three charges of cheating Theranos customers. The jury deadlocked on three counts involving individual investors.
Holmes, in a grey suit jacket, remained calm following the judgement. No sentencing date was scheduled.
Prosecutors say Holmes, 37, defrauded private investors between 2010 and 2015 by claiming Theranos’ tiny machines could do several tests with just a few drops of blood. If convicted, she may face up to 80 years in jail from US District Judge Edward Davila.
Holmes was also accused of lying to patients about the tests’ accuracy but acquitted of it. Holmes may appeal. The jury took seven days to decide.
With Theranos, Holmes became a Silicon Valley celebrity. Forbes assessed her value at $4.5 billion in 2015. After meeting the founder, who wore a Steve Jobs-inspired black turtleneck, wealthy private investors like Rupert Murdoch invested millions in the firm.
Theranos’ unsuccessful attempt to revolutionise lab testing has been uncovered. Prosecutors claim the business covertly used Siemens devices to do patients’ tests. Theranos failed after the Wall Street Journal suggested its devices were flawed and inaccurate.
In 2018, Holmes and Theranos’ former COO Ramesh “Sunny” Balwani were charged. Fraud and conspiracy charges were dismissed. Balwani has pled not guilty and will be tried later.
During the September trial in San Jose, California, jurors heard from former Theranos workers who left the firm due to technological issues. Investors said Holmes made false statements about Theranos, such its devices being utilised by the US military. Undeterred by Theranos’ flaws, former patients spoke before jurors.
They claim that if Holmes had been honest with investors and patients, the venture would have gotten finance and income. “She chose deception over failure. “She chose to be dishonest,” said Assistant US Attorney Jeff Schenk. It was a criminal choice.
Holmes stated she never intended to deceive anybody and that Theranos’ lab directors were in control of test quality. Mr. Downey said the evidence showed Holmes was not driven by a cash shortage at Theranos, but rather by “building a technology that would change the world.”
“You know that crooks cash out at the first sign of trouble,” Downey remarked. “She went down with that ship when it went down.”