Ex-Theranos president Balwani sentenced to nearly 13 years for fraud

Dec 7 (Reuters) – A U.S. judge on Wednesday sentenced former Theranos CEO Ramesh “Sunny” Balwani to 12 years and 11 months in prison for defrauding investors and patient blood testing startups. The charge was led by a spokeswoman, Elizabeth Holmes. The US Attorney’s Office confirmed.

U.S. District Judge Edward Davila in San Jose, California, handed down the sentence to Balwani, who was convicted by a jury in July of two counts of conspiracy and 10 counts of wire fraud.

Prosecutors said Bilwani, 57, conspired with Holmes, 38, to trick Silicon Valley investors into believing the company had acquired tiny machines that could accurately perform a wide range of medical diagnostic tests from a small amount of blood. carry on

Meanwhile, the company secretly relied on traditional methods to conduct tests and provided inaccurate results to patients, prosecutors said.

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Holmes, who started the company as a college student and became its public face, was indicted in 2018 along with her former romantic partner, Balwani.

Davila later granted each a separate trial after Holmes said he would take the stand and testify that Balwani was abusive in their relationship. He has denied the allegations.

Holmes was convicted in January of four counts of fraud and conspiracy but acquitted of defrauding patients.

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Davila sentenced Holmes to 11-1/4 years in prison at a hearing last month, calling Theranos “a project full of lies, misrepresentations, simple hypocrisy and lies.”

Prosecutors later argued that Bilwani should have been sentenced to 15 years in prison, saying he knew the Theranos tests were flawed from overseeing the company’s laboratory operations, and decided to “put Theranos’ financial health ahead of the actual health of patients.” Prioritize you.”

The probation office recommended a nine-year sentence.

Balwani’s lawyers asked for a no-trial sentence, arguing that he sought to make the world a better place through Tyranos and was not motivated by fame or greed.

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Once valued at $9 billion, Theranos promised to revolutionize how patients get diagnoses by replacing traditional labs with tiny machines envisioned for use in homes, drugstores and even on the battlefield.

The company collapsed after a series of Wall Street Journal articles questioned its technology in 2015.

The case of United States v. Balwani, United States District Court, Northern District of California, No. 18-cr-00258.

Reporting by Judy Goodway in New York; Editing by Nolin Walder and Bill Berkrot

Our Standards: The Thomson Reuters Trust Principles.

Judy Goodway

Thomson Reuters

Judy Goodway reports on banking and securities law. Reach her at [email protected]

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