A women's prison halfway between the Texas cities of Houston and Austin will be Elizabeth Holmes' home for the foreseeable future. The former star entrepreneur, who was at the center of one of the biggest fraud scandals in the American economy in the recent past, was supposed to start her prison sentence of just over eleven years here on Tuesday.
Business correspondent in New York.
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In January last year, Holmes was found guilty on four of eleven counts of defrauding investors in her company Theranos. She has appealed against this ruling. She also tried to delay the start of the prison sentence while the appeal process was ongoing, but the judge in charge rejected it.
A climb with a quick end
Holmes was once hailed as a prodigy of the American start-up scene. She founded Theranos when she was 19 years old and claimed to have found a groundbreaking method for blood testing that did not require any injections at all. Investors believed in the company's potential, and in 2015 Holmes became the youngest billionaire to make it onto the Forbes list of the super-rich.
A little later, however, the ascent came to an abrupt end. An investigative report in the Wall Street Journal raised doubts about the reliability of the supposedly revolutionary test methods. Theranos had to cease operations, regulators investigated, Holmes was charged. The trial against her was repeatedly delayed, first because of the Corona pandemic, then because of her first pregnancy. Along with her, Ramesh "Sunny" Balwani, who was number two in the company as chief operating officer, was also indicted. The two were also in a relationship for a long time. Balwani has also been found guilty in a separate trial and recently began his prison sentence.
The prison where Holmes will now be housed has a low security level and allows regular family visits. In addition to her son, who is now just under two years old, Holmes had a daughter three months ago. It is considered likely that their sentence will be reduced if they are well behaved.