The charges against Holmes, according to AP, include “allegedly defrauding investors, doctors and the public” as the head of Theranos.
Theranos founder Elizabeth Holmes has been charged with wire fraud by a U.S. grand jury #tictocnews pic.twitter.com/w9xn7vgTIK
— TicToc by Bloomberg (@tictoc) June 15, 2018
Sparked by investigative work done by The Wall Street Journal into Theranos, a two-and-a-half-year-long investigation began by the San Francisco U.S. attorney’s office.
Wow. The awe-inspiring, tenacious, important work of @JohnCarreyrou at Theranos leads to the indictment of founder Elizabeth Holmes. June 15, 2018
Theranos swiftly announced that Holmes stepped down as CEO and was replaced by David Taylor, the company’s general counsel.
DOJ announces wire fraud charges against Theranos founder Elizabeth Holmes and Ramesh “Sunny” Balwani pic.twitter.com/MN77BOmw4w
— Zeke Miller (@ZekeJMiller) June 15, 2018
Holmes and ex-No. 2, former COO Ramesh Balwani, have both been charged with two counts of conspiracy to commit wire fraud and nine counts of wire fraud, according to The Wall Street Journal. If Holmes and Balwani are convicted, “they each face a maximum sentence of 20 years in prison and a fine of $250,000, plus restitution to those found to have been defrauded, on each count.” AP reports that these fines total $2.75 million each.
READ MORE: Former biotech star charged with fraud over blood-testing claims
This news coming three months after Holmes, Balwani and Theranos were brought up on civil fraud charges filed by the Securities Exchange Commission. The SEC alleged that the pair defrauded and lied to investors to raise $700 million.
Holmes’ was a marvel of Silicon Valley. After dropping out of Stanford, she sought to disrupt the blood-testing industry and create a device that “would give everyday Americans unlimited control over their health with a single finger prick.” Founding Theranos at 19, Holmes wowed investors with the idea that she could create a device that could detect a range of illnesses with just a drop of blood, done at low-cost to consumers.
