Ramesh “Sunny” Balwani, the former president of Theranos, the US company that claimed to have revolutionised blood testing, has been found guilty of fraud.
Balwani was convicted of misleading investors in what has been described as one of the biggest frauds in Silicon Valley history.
After five days of deliberations, the jury in Balwani’s case in San Jose, California, found him guilty of all 12 charges against him.
His former business and romantic partner Elizabeth Holmes, 37, was convicted of fraud in a separate trial earlier this year.
The trials were held separately because Holmes alleged that she had suffered abuse at Balwani’s hands that had driven her to mislead investors. Balwani, 57, has denied the claims.
Advertisement Image: Holmes once shared a stage with President Clinton and Jack MaDownfall
Founded in 2003 by 19-year-old Holmes, Theranos was a Silicon Valley darling that shut down after the unravelling of its claims to have invented a revolutionary finger-prick blood test.
The US government alleged the pair of orchestrating “an elaborate, years-long fraud”.
At the peak of its success, the company was valued at $9bn (£7bn) and Holmes shared a stage with former president Bill Clinton and Chinese entrepreneur Jack Ma in a panel discussion about equality and opportunity.
But a month later, the Wall Street Journal published a front-page story that claimed the company’s blood testing technology was so flawed that Theranos was using equipment made by other businesses to carry out tests in its laboratories.
The company’s former chief scientist had taken his own life two years earlier after telling his wife the finger-prick technology did not work, the newspaper said.
Charges
Investigations by medical and financial regulators soon followed and in 2018 criminal charges were filed against Holmes and Balwani, accusing them of fraud.
A jury convicted Holmes on two counts of wire fraud and two counts of conspiracy to commit fraud after seven days of deliberation and a three-month trial.
She faced 11 charges in total and was found not guilty of four felony charges, with the jury deadlocked on the remaining three.
During her trial, federal prosecutors presented evidence to depict Holmes as a charlatan obsessed with fame and fortune.
But she claimed she was emotionally and sexually abused by Balwani and cast herself in court as a visionary trailblazer in male-dominated Silicon Valley.
Holmes also told the court that she initially believed her company’s revolutionary blood tests were not the fake technology they ultimately proved to be.
The downfall of the company was dramatised in the acclaimed show The Dropout, starring Amanda Seyfried and Naveen Andrews.
Holmes and Balwani will be sentenced in the autumn. They face up to 20 years in prison and potentially needing to repay millions in compensation to the victims of their fraud.