Theranos—SEC charged Theranos with massive fraud; Holmes convicted on four counts and sentenced to 11+ years
In March 2018, the SEC charged Theranos, Elizabeth Holmes, and Sunny Balwani with raising more than $700 million through an elaborate years-long fraud involving false statements about the company's technology, business, and financial performance. Holmes settled with the SEC for $500,000 penalty and 10-year officer/director bar. In January 2022, Holmes was convicted on one count of conspiracy to commit investor fraud and three counts of wire fraud involving $140 million. She was sentenced to 135 months (11 years, 3 months) in prison in November 2022, with $452 million in restitution ordered. Balwani was convicted on all 12 counts and sentenced to nearly 13 years.
Scoring Impact
| Topic | Direction | Relevance | Contribution |
|---|---|---|---|
| Corporate Governance | -against | primary | -1.00 |
| Corporate Transparency | -against | primary | -1.00 |
| Overall incident score = | -0.340 | ||
Score = avg(topic contributions) × significance (critical ×2) × confidence (0.68)× agency (compelled ×0.25)
Evidence (2 signals)
Elizabeth Holmes convicted on four counts of fraud, sentenced to 135 months in prison
On January 3, 2022, a federal jury convicted Holmes on one count of conspiracy to commit investor fraud and three counts of wire fraud involving $140 million. On November 18, 2022, she was sentenced to 135 months (11 years, 3 months) in federal prison. Holmes and Balwani were ordered to pay $452 million in restitution.
SEC charged Theranos, Holmes, and Balwani with massive investor fraud
On March 14, 2018, the SEC charged Theranos, Elizabeth Holmes, and Sunny Balwani with raising more than $700 million through an elaborate years-long fraud involving false statements about the company's technology, business, and financial performance. Holmes settled, paying $500,000 penalty and accepting a 10-year officer/director bar.