Theranos Founder Elizabeth Holmes Guilty On Four Counts Of Fraud

A jury found former biotechnology CEO Elizabeth Holmes guilty Monday on four counts of fraud-related charges.

Holmes founded and served as CEO of Theranos, a medical technology startup that manufactured cheap and accessible blood-testing equipment. The Department of Justice indicted Holmes in 2018 on eleven fraud-related charges, alleging she willfully misled investors as to the effectiveness of the blood-testing technology.

Holmes was found guilty on four charges, including conspiracy to commit wire fraud and three counts of wire fraud against Theranos investors, The Wall Street Journal reported. No verdict was returned for two other wire fraud charges, and Holmes was found not guilty on the remaining wire fraud counts and one count of conspiracy to commit wire fraud.

Holmes faced up 20 years in prison if convicted on all counts.

Holmes’ trial began in late August, and hinged on whether Holmes knew her blood-testing technology didn’t work and whether she deliberately lied to investors.

Holmes founded Theranos in 2004, and by 2014 the company had attracted considerable fame and landed several high-profile members on its board of directors, including former Secretary of State Henry Kissinger and former Secretary of Defense James Mattis. Holmes also scored lucrative partnerships with Walgreens and Safeway.

Holmes promised to revolutionize blood testing by claiming its blood testing technology would be able to detect hundreds of diseases from only a few drops of blood, rather than a vial, and perform the tests outside of a laboratory.

Theranos’ flaws began to be revealed to the public following a 2015 investigation by The Wall Street Journal that found that Theranos was processing the vast majority of its blood samples with traditional blood testing equipment rather than its proprietary technology. Holmes had not disclosed this fact to the company’s financial backers, and one of Theranos’ largest investors sued for fraud in 2016.

The jurors began their deliberations last Monday, asking the presiding judge Edward Davila to replay recordings of a pitch Holmes made to investors in 2013, in which she bragged about potential government contracts.

The trial of Holmes’ former lover and business partner Sunny Balwani is expected to begin in early January.