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• Holmes was charged with nine counts of wire fraud and two counts of conspiracy
• She was found guilty on three of the nine fraud counts and one of two conspiracy counts
Former Silicon Valley start-up founder Elizabeth Holmes, who claimed to revolutionize blood testing through her firm Theranos Inc. was convicted on Monday of defrauding investors.
Holmes was convicted on four of 11 charges that she conducted a yearslong fraud scheme against investors while running her blood-testing start-up.
She was charged with nine counts of wire fraud and two counts of conspiracy to commit wire fraud under an indictment brought three and a half years ago. She was found guilty on three of the nine fraud counts and one of two conspiracy counts.
Three of the charges Holmes was accused of included large investments of which $100 million was from a family office of former Education Secretary Betsy DeVos ; $38 million from PFM Health Sciences LP, a hedge fund that invested $96 million in Theranos and recovered $43 million in a 2016 civil lawsuit against the company; and about $6 million from Daniel Mosley, a former estate lawyer who connected Theranos to his wealthy clients, who invested nearly $380 million into Theranos.
She was acquitted on four charges related to defrauding patients—one charge of conspiracy to commit wire fraud and three charges of wire fraud.
The jury failed to reach a verdict on three counts related to investors, after saying earlier Monday it was having difficulty reaching consensus on three of the charges.
Holmes was charged with an indictment in 2018 along with the company’s president and Holmes’ former romantic partner, Ramesh "Sunny" Balwani.
Theranos had been under investigation since at least 2016 when Holmes and Balwani were temporarily banned from owning or running a medical laboratory.
Prosecutors have accused the two of deliberately misleading investors, policymakers, and the public about the accuracy of Theranos’ blood-testing technologies. They alleged that the pair "knew Theranos was not capable of consistently producing accurate and reliable results for certain blood tests, including the tests for calcium, chloride, potassium, bicarbonate, HIV, Hba1C, hCG, and sodium."'
Inputs from Wall Street Journal
Picture Credits: Bloomberg