Theranos founder hit with criminal charges

Theranos founder Elizabeth Holmes was accused of

Theranos founder Elizabeth Holmes was accused of"massive fraud by the SEC in March

They also told investors the company's partnership with Walgreen's for blood-testing "Wellness Centers" was expanding, when in reality it was stalled because executives at the pharmacy giant "had concerns with Theranos's performance", the indictment says.

Holmes agreed in March to settle "massive fraud" charges with the Securities and Exchange Commission under which she was barred from serving as an officer or director of a public company for 10 years.

She and Balwani pitched a tale in investor presentations, product demonstrations and media articles about the startup's key product - a portable blood analyzer - which they claimed could revolutionize the industry by inexpensively conducting comprehensive tests from drops of blood from fingers. The two allegedly knew there were "accuracy and reliability problems", and that it "could not compete with existing, more conventional machines", the US Attorney's office said.

"This indictment alleges a corporate conspiracy to defraud financial investors", said John F. Bennett, special agent in charge of the Federal Bureau of Investigation in San Francisco.

The criminal charges disclosed Friday go well beyond the SEC's civil allegations, which Balwani has contested. Balwani faces those charges in court. The company's general counsel, David Taylor, will take over as CEO. Holmes remains the company's chairman.




The indictment also claims that the defendants represented to investors that Theranos would generate $100 million in revenues and break even in 2014 and that the company expected about $1 billion in revenues the following year.

Federal authorities allege there was a second scheme to defraud doctors and patients, saying "many hundreds of patients paid, or caused their medical insurance companies to pay" for blood tests that were advertised as accurate and reliable. Jeffrey Coopersmith, Balwani's attorney, said his client had committed no crimes. For Theranos founder Elizabeth Holmes, it may end up taking the form of a jail cell. "Mr. Balwani looks forward to trial because he did not defraud anyone, and it will be an honor to defend him vigorously", he said.

The punishment sounds heavy, but so does the alleged nature of the crime - potentially putting people's lives at risk with inaccurate blood test results.

The Wall Street Journal reported in April that Theranos would cut its workforce "from about 125 employees to two dozen or fewer", according to sources familiar with the matter.

Recommended News

  • Cuper: Mo Salah should be fine to face Russian Federation

    Cuper: Mo Salah should be fine to face Russian Federation

    Defender Jose Gimenez was the unlikely 89th-minute match victor for Tabarez's men, who also struck a post late on through Edinson Cavani.
    Saudi Arabia Royal Family launch scathing attack on players after Russian Federation  loss

    Saudi Arabia Royal Family launch scathing attack on players after Russian Federation loss

    Another substitute, Artem Dzyuba, made it 3-0 with about 20 minutes remaining, putting the game out of Saudi Arabia's reach. Petersburg, Sochi, Kazan, Saransk, Kaliningrad, Volgograd, Rostov-on-Don, Nizhny Novgorod, Yekaterinburg and Samara.
    Journalist Shujaat Bukhari shot dead in Srinagar

    Journalist Shujaat Bukhari shot dead in Srinagar

    Shehla, who also hails from Kashmir tweeted, "Shujaat sahab's funeral prayers will be offered in a while". The Jammu and Kashmir Police have released images of the men suspected to have killed Bukhari.
  • Cristiano Ronaldo to pay £16.5m fine after tax fraud case

    Cristiano Ronaldo to pay £16.5m fine after tax fraud case

    The Real Madrid club-record goalscorer scored in Germany 2006 against Iran, in 2010 against North Korea and in 2014 against Ghana. The hat trick was Ronaldo's 84th goal for Portugal , tying him with Ferenc Puskas for most global goals by an European player.
    China suggests sanctions relief for N Korea after United States  summit

    China suggests sanctions relief for N Korea after United States summit

    Meanwhile, a spokesman for Vladimir Putin has said the Russian president welcomes the outcome of the talks with Mr Kim. Critics said the encounter had produced a document short on details about the key issue of Pyongyang's atomic weapons.
    Korea media says abductions of Japan's nationals

    Korea media says abductions of Japan's nationals "resolved"

    In May, after North Korea criticised his vice-president, Mike Pence, Trump said the summit was cancelled. Kim has not yet taken any concrete step to dismantle his nuclear programs .
  • How To Watch The Matches Online And On TV

    How To Watch The Matches Online And On TV

    The event brings one of the most exceptional football players into one place, and you get a chance to cheer your favorite teams . Some may involve paying for access, or for VPNs, some might be from shady sources, and some won't be easy.
    Chance of Showers, Storms Monday

    Chance of Showers, Storms Monday

    Beyond Wednesday , rain chances become minimal as high temperatures creep back into the 90s for the second half of the week. With a wave of low pressure along a front to our south, shower and storm chances increase after 4 p.m. or so.
    Category 3 Hurricane Bud weakens on path to Mexico's Baja

    Category 3 Hurricane Bud weakens on path to Mexico's Baja

    Hurricane Bud was churning the sea west of Mexico Tuesday morning as a Category 4 hurricane with winds of 130 miles per hour . Despite weakening, Bud still could make landfall later this week as well as bring some locally damaging winds.
  • President Trump: I won't sign the moderate immigration bill

    President Trump: I won't sign the moderate immigration bill

    Bob Goodlatte, R-Virginia, that would provide a pathway to legal status for Dreamers while limiting legal immigration levels. In this morning's interview, he was commenting on the discharge petition in the House, and not the new package.
    2 tornadoes confirmed with speeds of 111-135 mph

    2 tornadoes confirmed with speeds of 111-135 mph

    Pictures from the area showed major damage to businesses, including flipped vehicles at a auto dealership and U-Haul facility. The report says the tornado likely touched down around the Wyoming Valley Mall and traveled southeast for about a half mile.
    Egypt vs Uruguay, Yekaterinburg Arena,Yekaterinburg

    Egypt vs Uruguay, Yekaterinburg Arena,Yekaterinburg

    Jose Gimenez headed a 90th-minute victor as Uruguay beat Egypt 1-0 in their opening Group A game at the World Cup in Yekaterinburg .

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.