In 2014, Forbes named Elizabeth Holmes the world’s youngest self-made billionaire and valued her company, Theranos, at $9 billion. However, her empire crashed when a federal grand jury indicted her for committing a massive fraud. After Holmes stepped down as CEO of Theranos, she went to trial for her crimes. The jury found her guilty on four federal charges and sentenced her to 11 years and three months in prison.
In March 2004, Elizabeth Holmes dropped out of Stanford University to establish her startup, Theranos. According to CNN, “Theranos” is a combination of two words: therapy and diagnosis. The Straits Times reported that the organization raised more than $6 million in funding, taking the company’s evaluation to $30 million. By 2010, the company raised another $45 million in funding, which takes the company’s evaluation to $1 billion. Three years later, Holmes publically promoted her technology and announced that their machine, Edison, can perform various tests with a drop of blood.
The outlet also stated that Theranos was valued at $9 billion after raising $400 million in funding in 2014. However, a 2015 report from The Wall Street Journal mentioned that the organization noted above utilized its technology for only a limited number of tests. Moreover, many employees questioned the accuracy of those tests. The FDA also reported that the company used “unapproved devices” for testing purposes, per The Strait Times.
After extensive investigation, in March 2018, the US Securities and Exchange Commission charged Elizabeth Holmes and one of her partners with fraud. CNN mentioned that Holmes and her partner raised over $700 million by defrauding their investors. Holmes went to trial for fraud in August 2021.
Where is Elizabeth Holmes now?
Before Elizabeth Holmes was charged, the Centers for Medicare and Medicaid announced in 2016 that one of the company’s labs in California failed to meet safety standards and posed “immediate jeopardy to patient health and safety”. Two years later, in June 2018, a federal jury indicted Elizabeth Holmes and one of her partners on multiple charges.
According to The Wall Street Journal, the jury indicted the duo on two counts of conspiracy to commit wire fraud and nine counts of wire fraud. The outlet mentioned that the trial was supposed to start in July 2020 but couldn’t because of the COVID-19 pandemic. In 2021, Holmes announced her pregnancy, and the court postponed the trial again. Eventually, the trial began in September of that year, and Holmes testified in her defense.
CNN reported that 32 witnesses testified during the three-month trial. In the closing arguments, the prosecution team noted that Elizabeth Holmes lied to her investors because she didn’t want her business to fail. The prosecutor said, “She chose fraud over business failure. She chose to be dishonest with investors and with patients. That choice was not only callous, it was criminal.”
On the other hand, the defense claimed that Elizabeth Holmes was “building a business and not a criminal enterprise.” The defense attorney painted Holmes as a visionary who wanted to invent a technology that could perform any blood test. After the closing arguments, CNN reported that the jury deliberated for more than 50 hours to deliver a guilty verdict. The outlet mentioned that the jury found Holmes guilty of one count of conspiracy and three counts of wire fraud.
In September 2022, Holmes filed for a new trial because one of the witnesses claimed he felt guilty about his testimony. However, the court denied her request. As a result, the court sentenced her to 11 years and three months in prison. Currently, Elizabeth Holmes is serving her sentence at the Federal Prison Camp (FPC) Bryan in Texas.
In 2019, HBO released a documentary titled The Inventor: Out for Blood in Silicon Valley. The documentary talked about the rise and fall of Holmes. The documentary is available for streaming on HBO Max.