Founder of start-up Theranos convicted of fraud in California
Former Silicon Valley leader Elizabeth Holmes was found guilty of fraud on Monday by a court in San José, California after three months of trial and 50 hours of deliberation.
Elizabeth Holmes leaves the San José court on Monday.
AFP
Elizabeth Holmes, a former Silicon Valley star who promised to revolutionize blood testing with her start-up Theranos, was sentenced Monday for fraud by a California court, a rare sanction in the “tech” world where disillusionment is rife. yet commonplace.
After more than three months of trial and seven days of deliberation, the jury of the San José court found her guilty of defrauding investors but acquitted her of certain charges and was unable to come to grips with it. ‘agreement on other facts with which he was accused. This conviction exposes the 37-year-old woman to several decades in prison, but the sentence will be pronounced at a later date by the federal court.
The verdict “reflects Ms. Holmes’ guilt in this large-scale fraud,” said prosecutor Stephanie Hinds in a statement read out of court by a representative. Elizabeth Holmes remains free on bail, a measure the terms of which are to be reviewed next week. Pressed to say if she intended to appeal her conviction, the fallen boss made no comment when she left court.
She had founded Theranos in 2003, at the age of just 19, and promised diagnostic tools that were faster and cheaper than those in traditional labs.
Over $ 700 million raised
With the help of a careful account, she had managed in a few years to gain the trust of luminaries and to raise funds from prestigious investors, attracted by the profile of this young woman, a rarity in the male world of Californian engineers. .
In the early 2010s, she notably wore a black turtleneck sweater in explicit reference to Apple founder Steve Jobs, to whom the world of “tech” constantly compared the young entrepreneur when she was at the top. of his glory. Former Secretary of State Henry Kissinger backed her, as did former Defense Minister James Mattis or media mogul Rupert Murdoch, who is investing more than $ 100 million in Theranos.
At its peak, the company is valued at nearly $ 10 billion, and majority shareholder Elizabeth Holmes is the head of a fortune of $ 3.6 billion, according to Forbes magazine. The story was beautiful. As a child, she hated needle pricks during blood tests. She will therefore invent a simple, fast and efficient machine that will allow everyone to carry out hundreds of blood diagnoses from a single drop of blood taken from the fingertip.
But in 2015, the Wall Street Journal noted the huge pot of roses: the fabulous machine promised by Theranos never worked.
“Criminal choice”
In front of the San José court where the trial opened in early September 2021, a pregnant woman recounted how she mistakenly believed she had miscarried after using one of Theranos’ tests. Employees testified that they warned the boss of their doubts about the operation of the machines. Some have also told the press about Ms. Holmes’ repeated lies to her teams and to investors.
For some, she embodied this Silicon Valley mantra: “fake it till you make it”. Elizabeth Holmes pleaded this good faith in court. “We were on the right track to accomplish our goals” before the business collapsed, “she said at the helm. “Failure is not a crime, persevering and failing to achieve it is not a crime”, for his part launched his lawyer Lance Wade at the start of the trial.
“Mrs. Holmes tried to the end to save her company, never selling a share”, added the lawyer, wanting as proof of the good faith of his client the fact that she “sank with the boat”. The prosecution made a whole different reading of this fairy tale that turned into a financial nightmare. “Mrs. Holmes chose fraud rather than bankruptcy, she chose to be dishonest”, had attacked in his requisitions the prosecutor Jeff Schenk. “This choice was not only ruthless but also criminal”, he had launched to the jurors.
According to the prosecutor’s office, the former entrepreneur deliberately deceived her partners to raise funds, more than 700 million dollars in all. In response, Elizabeth Holmes assured jurors that her romantic relationship with her ex-director of operations, Ramesh “Sunny” Balwani – who will be tried separately – had been peppered with forced sex and that he was responsible for the problems. techniques of his company.
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