[co-author: Janki Kaswala]
Elizabeth Holmes, founder of Theranos, was convicted of three counts of wire fraud and one count of conspiracy to commit wire fraud. The verdict follows a high-profile, fifteen-week trial in federal court in San Francisco. Holmes was alleged to have defrauded investors, medical professionals, patients, and the public by exaggerating and making false statements about the accuracy of Theranos’s blood-testing technology. The government’s prosecution demonstrates the Department of Justice’s commitment to prosecuting white collar crime, particularly in the tech and healthcare industries.
Holmes took Silicon Valley by storm by raising hundreds of millions of dollars from investors on the promise of a groundbreaking new technology that could scan for hundreds of diseases with just a few drops of blood from a finger prick. But prosecutors presented evidence showing that Theranos’s technology produced incorrect results and that Theranos relied on altered blood analyzer machines that other companies had developed. Prosecutors introduced audio clips of Holmes falsely telling investors that the blood-testing device could perform any blood test. Holmes took the stand in her own defense and testified that she genuinely believed in the prospective success of Theranos’s technology.
Ultimately the jury found Holmes guilty of defrauding investors of almost $145 million but acquitted her on the charges relating to defrauding patients. Holmes will be sentenced by...
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