SAN FRANCISCO – Fallen United States biotech star Elizabeth Holmes was convicted today of defrauding investors in her blood-testing startup Theranos, in a high-profile case seen as an indictment of Silicon Valley culture.
Holmes is a rare example of a tech exec being brought to book over a company flaming out, in a sector littered with the carcasses of money-losing companies that once promised untold riches.
Her case shone a spotlight on the blurred line between the hustle that characterises the industry and outright criminal dishonesty.
Jurors took seven days of deliberations to reach their verdict, finding her guilty of four counts of tricking investors into pouring money into what she claimed was a revolutionary testing system.
But the panel – who had listened to weeks of sometimes complex evidence – also acquitted her on four charges and could not reach a verdict on three others.
“The guilty verdicts in this case reflect Ms Holmes’ culpability in this large-scale investor fraud and she must now face sentencing for her crimes,” US attorney Stephanie Hinds said in a prepared statement read outside the courthouse by a representative.
Holmes made no comment as she left the court when asked if she intended to appeal.
The 37-year-old now faces the possibility of 20 years behind bars for each conviction. She remains at liberty ahead of another hearing on the terms of her bail next week. No date was set for sentencing.
Holmes had vowed to revolutionise health diagnostics with self-service machines that could run an array of tests on just a few drops of blood, a vision that drew high-profile backers and made her a billionaire by the age of 30.
She was hailed as the next tech visionary on magazine covers and collected mountains of investors’ cash, but it all collapsed after Wall Street Journal reporting revealed the machines did not work as promised.
Prosecutors spent 11 weeks presenting over two dozen witnesses, as they painstakingly laid out their argument that Holmes knew her technology fell short, and deliberately misled investors and patients.
She personally put the logos of pharma giants Pfizer and Schering-Plough onto Theranos reports hailing the company’s blood-testing technology, which were then shared with investors.
That was done without the firms’ permissions, and was a key piece of the prosecution's argument that she purposely tried to inflate Theranos’ credibility in order to win backers. – AFP, January 4, 2022
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