Elizabeth Holmes’ ex-boyfriend sentenced to nearly 13 years in prison for Theranos fraud

Former Theranos Inc chairman Ramesh ‘Sunny’ Balwani who was found guilty of defrauding investors and patients in the blood-testing startup – Reuters

A judge has sentenced a top aide and ex-boyfriend of ousted Theranos founder Elizabeth Holmes to jail for tricking people into trusting the failed blood testing startup.

U.S. District Court Judge Edward Davila sentenced Ramesh ‘Sunny’ Balwani to nearly 13 years in prison and then three years on probation for his role in what prosecutors said was a massive fraud perpetrated on investors and traders. Theranos patients.

Balwani is expected to surrender to be taken into custody on March 15.

Fallen US biotech star Holmes, whose fraud trial was separate from Balwani’s, has asked an appeals court to overturn his conviction and a resulting prison sentence of more than 11 years.

Holmes’ appeal said she challenged the prison sentence handed down in November, as well as “any adverse ruling incorporated, prior to or incidental to the judgment.”

She was convicted of four counts of criminal fraud in January for persuading investors she had developed a breakthrough medical device before the company shut down after an investigation by The Wall Street Journal.

Jurors found Balwani guilty on all 12 counts of fraud filed by federal prosecutors, the court heard.

Ramesh

Ramesh ‘Sunny’ Balwani appears before U.S. District Judge Edward Davila during his sentencing in federal court in San Jose, California – Reuters

Holmes and Balwani are rare examples of tech executives charged for a young company that doesn’t live up to its hype, in an industry littered with the carcasses of failed startups that once promised untold riches.

Holmes, who is pregnant, will not have to surrender until April next year, according to an order from Mr Davila, who presided over both trials in a courtroom in San Jose, California.

The 38-year-old became a Silicon Valley star when she said her start-up was perfecting an easy-to-use test kit that could perform a wide range of medical diagnoses with just a few drops of blood.

During his trial, Holmes described Balwani as a controlling force at Theranos.

Balwani spent six years as Theranos COO - Reuters

Balwani spent six years as Theranos COO – Reuters

His trial highlighted the blurry line between the turmoil that characterizes the industry and outright criminal dishonesty.

U.S. Attorney Robert Leach told jurors at a federal courthouse in San Jose that Balwani, 57, ran the business alongside Holmes and that the pair were “partners in everything, including their crime.”

But Holmes and Balwani each dismissed the charge in court, countering that they truly believed in Theranos’ potential in what was a failure, not a fraud.

Balwani, Holmes’ senior by nearly two decades, was recruited to help run the company she founded in 2003 at just 19 years old.

Prosecutors alleged that Holmes and Balwani knew the technology did not work as advertised, but continued to promote it as revolutionary to patients and investors who poured money into the company.

As Theranos soared, it attracted luminaries such as Rupert Murdoch and Henry Kissinger, but a series of reports casting doubt on Mr. Murdoch’s Wall Street Journal company claims sparked the collapse of Theranos. company.

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