Theranos CEO Elizabeth Holmes arrives at Texas prison to serve 11-year sentence
Theranos founder Elizabeth Holmes – convicted last year on four counts of fraud – reported Tuesday to the federal facility in Bryan, Texas, to serve her 11-year sentence. The minimum security prison is about 160 km north of Houston, her hometown.
It comes after a court rejected Holmes’ request to remain free on bail while a challenge to the original conviction was considered. The Federal Bureau of Prisons confirmed her arrival at the facility, without providing more details about her confinement.
Once called the youngest self-made billionaire in the world, Holmes will now likely work alongside other prisoners for between 12 cents and $1.15 an hour – with a majority of the amount addressing her court-mandated restitution payments.
Earlier this month, the woman and her former romantic and business partner, Ramesh “Sunny” Balwani, were ordered by a US judge to pay $452 million to victims. Balwani – also accused of playing a role in the scheme – is already serving a 13-year sentence in a California prison.
Together, the duo has been convicted of tricking some of the most prominent investors in the world, including former US Treasury Secretary George Shultz and media tycoon Rupert Murdoch, into supporting Theranos.
Their blood-testing start-up, once valued at $9 billion, promised its technology required just a few drops of blood to detect conditions like diabetes. The tech, however, failed to work – and the company eventually collapsed in 2018.
The image of Holmes arriving at the prison on Tuesday is potentially a crucial warning to other entrepreneurs in Silicon Valley, where observers have long been raising concerns over a “fake it until you make it” culture.
It’s rare to see tech bosses getting convicted for fraud. The US government hopes the Theranos founder’s case will prevent other executives from making unusual claims about what their tech can do while hunting for investments.
Holmes has not admitted to any criminal wrongdoing.