Theranos founder Elizabeth Holmes has turned herself in for an 11-year prison sentence, marking a final chapter in a years-long fraud saga that riveted Silicon Valley.
The 39-year-old tech founder walked into the minimum-security, federal women’s prison camp located in Bryan, Texas, on Tuesday afternoon. Footage captured from outside the facilities shows that she was accompanied by an escort, was not handcuffed and wore a casual outfit. Holmes appeared in good spirits, smiling as she entered the building.
Holmes had been out on bail since she was indicted on fraud charges in 2018 over her role as the head of the failed blood-testing firm. She was convicted in November 2022 on four counts of defrauding investors and sentenced to 11 years and three months in prison.
Under federal law, Holmes is required to serve 85 per cent of the time, even if her sentence is reduced for good conduct. Federal prison camp Bryan, where Holmes has been ordered to serve her sentence, houses primarily white-collar and non-violent women federal prisoners, and lacks the fencing and strict rules of higher-security prisons.
It is a work-focused programme that requires all inmates to hold a job for a minimum of 90 days.
Holmes had attempted to delay serving her sentence, arguing that she should be able to remain out of custody while she seeks a new trial based on alleged wrongdoing by the prosecution. US district judge Edward Davila denied those requests, stating that a new trial or an overturning of the guilty verdict was unlikely.
Holmes reportedly spent her final days of freedom with her partner, Billy Evans, and their two children. Her trial was originally delayed as she gave birth to her first child in July 2021 and she appeared at her sentencing hearing in November pregnant with her second child, who was born in March.
Sunny Balwani, Holmes’s former business and romantic partner, was convicted on all 12 counts of fraud he was charged with, and in April began his 13-year sentence at a prison in California.
The imprisonment of both Theranos figureheads marks the end of the dramatic tale of Theranos – a company Holmes founded in 2003 after dropping out of Stanford University at 19. She promised a revolutionary technology that could run hundreds of health tests on just one drop of blood, amassing millions of dollars in funding from big-name backers like the former secretary of state Henry Kissinger and media mogul Rupert Murdoch.
Theranos was valued at more than $10 billion at its peak in 2014, until reporting in the Wall Street Journal in 2015 revealed shortcomings in the company’s core technology – leading the company to quickly unravel. By 2018, Theranos had dissolved.
The dramatic trial of Holmes lasted 18 weeks, featuring testimony from high-profile Theranos investors including the former defence secretary James Mattis. Throughout the proceedings, the defence team painted Holmes as an ambitious and naive young founder who was unaware of the extent to which Theranos’s technology was malfunctioning. Before her sentencing, Holmes expressed regret for letting down “the people who believed in us”.
“I am devastated by my failings,” she said. “Every day for the past years I have felt deep pain for what people went through because I failed them. I regret my failings with every cell of my body.”
The harsh sentencing – much longer than the 18 months of house arrest requested by Holmes’s team – is thought to have set a new precedent in Silicon Valley and its hype cycle that enabled Theranos to garner as much success as it did with so few checks and balances.
Holmes, meanwhile, has embarked on a campaign to rehabilitate her image, breaking seven years of media silence with an extensive profile in the New York Times on her new life as “Liz” – a devoted mother who has abandoned her signature baritone speaking voice.
She will face three years of supervised release after her sentence ends and has been ordered to pay $452 million in restitution to victims of the fraud. – Guardian