Ex-boyfriend of Elizabeth Holmes, founder of Theranos, found guilty of fraud

The jury found Ramesh “Sunny” Balwani guilty on 12 counts of fraud brought by federal prosecutors, a spokesman for the San Jose City Court in Silicon Valley told AFP. The announcement of the sentence is scheduled for the end of the year and the convict risks spending several years in prison.

Balwani was tried separately from former US biotech star Elizabeth Holmes, whose trial in the same room ended in January. The verdict found her guilty on four counts of deceiving investors by pumping money into what she claimed was a breakthrough blood testing system.

Despite this, the jury – which heard weeks of complex evidence – also acquitted her on four counts and returned no verdict on three others. Holmes is expected to receive his sentence in September.

During the trial, Holmes testified that Balwani had been physically and emotionally abusive during their relationship, statements which he denied.

Holmes and Balwani are rare examples of tech executives responding to accusations of company demise, in an environment full of failed startups that once promised untold riches. His trial demonstrated how thin the line between profit in the industry and criminal dishonesty is.

U.S. Attorney Robert Leach told jurors in federal court in San Jose that Balwani ran the business alongside Holmes and that the two were “partners in everything, including crime.”

Stephen Cazares, Balwani’s lawyer, assured that his client had not committed fraud and was convinced of the potential of Theranos. Balwani, almost two decades older than Holmes, was hired to help run the company she founded in 2003 when she was 19.

Holmes, now 38, promised his own testing machines capable of performing a low-cost analytical range with just a drop of blood, a promise that was broken when allegations of fraud surfaced.

Prosecutors allege that Holmes and Balwani were aware that the technology was not working as promised, but continued to promote it as revolutionary for patients and investors.

Figures such as Rupert Murdoch and Henry Kissinger became interested in Theranos when it was on the crest of the wave. However, a Wall Street Journal report cast doubt on the company’s claims, which started Theranos’ decline.

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