Convicted Theranos founder Elizabeth Holmes was on Friday sentenced to more than 11 years in prison for fraud. Holmes, who was found guilty of deceiving investors about the efficacy of the blood-testing technology of her company, apologized – saying she’s “devastated.”
Her long legal battle started seven years ago when it was discovered that she had lied about the results of the clinical trials conducted in Theranos. What followed were unprecedented probes, discoveries that would later end the company and consequently sent its founder to jail.
Holmes, who was convicted in January in the U.S. District Court for the Northern District of California, expressed tearful remorse before she was sentenced on Friday.
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“I loved Theranos. It was my life’s work,” Holmes said. “My team meant the world to me. I am devastated by my failings. I’m so so sorry. I gave everything I had to build my company.”
CNBC gave a brief story of Holmes’ journey to 15 years imprisonment, despite efforts by her lawyers to get her a shorter sentence.
Her defense team argued she should face a maximum sentence of 18 months, according to court filings. Instead, she was given 135 months, which amounts to 11 years and three months, behind bars.
The Wall Street Journal first broke the story of how Theranos’ blood-testing technology was struggling to meet expectations in 2015. Whistleblowers and other witnesses came forth to provide detailed accounts of how Holmes and former operating chief Ramesh “Sunny” Balwani deceived patients, partners, investors and employees about the company’s progress and the capabilities of its technology.
Once valued at $9 billion by private investors, Theranos shut down in 2018.
“Thank you for having me. Thank you for the courtesy and respect you have shown me,” she said Friday. “I have felt deep pain for what people went through because I failed them. To investors, patients, I am sorry.”
Prosecutors sought a 15 year sentence for the pregnant 38-year-old former billionaire and Silicon Valley celebrity. In July, Balwani, who was romantically involved with Holmes years earlier, was found guilty of 12 criminal fraud charges. His sentencing is set for next month.
U.S. District Court Judge Edward Davila, who presided over Holmes’ trial, handed down the sentence.
The erstwhile billionaire had attempted to move for a new trial after a former employee appeared at her doorstep in August to speak with her. Holmes’ partner, Billy Evans, told the court that the former employee made remorseful remarks at their shared residence.
But that employee, Adam Rosendorff, told the court that his remarks were due to distress at the thought of a child spending time without their mother. The Theranos founder gave birth in July to her first child, and is expecting another.
Holmes’ sentencing has triggered calls for tougher punishment for fraudulent founders. It comes on the heels of Sam Bankman-Fried’s FTX saga, which in a similar way, consumed investors’ funds, setting the former billionaire founder up for potential legal trouble.
CNBC noted: Sam Bankman-Fried, faces a daunting future, following the sudden collapse of his cryptocurrency exchange FTX last week. Bankman-Fried hasn’t been charged with a crime, but he’s in legal jeopardy after revelations that his company was unable to give depositors their money back because some of it was used to fund risky, losing bets.