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Fraud trial: Theranos founder Elizabeth Holmes guilty

SAN FRANCISCO (AFP) – Fallen United States (US) biotech star Elizabeth Holmes was convicted on Monday of defrauding investors in her blood-testing start-up Theranos, in a high-profile case seen as an indictment of Silicon Valley culture.

Holmes is a rare example of a tech exec being brought to book over a company flaming out, in a sector littered with the carcasses of money-losing companies that once promised untold riches.

Her case shone a spotlight on the blurred line between the hustle that characterises the industry and outright criminal dishonesty.

Jurors took seven days of deliberations to reach their verdict, finding her guilty of four counts of tricking investors into pouring money into what she claimed was a revolutionary testing system.

But the panel – who had listened to weeks of sometimes complex evidence – also acquitted her on four charges and could not reach a verdict on three others.

Elizabeth Holmes entering federal court in San Jose. PHOTO: AP

“The guilty verdicts in this case reflect Holmes’ culpability in this large-scale investor fraud and she must now face sentencing for her crimes,” US Attorney Stephanie Hinds said in a prepared statement read outside the courthouse by a representative.

Holmes made no comment as she left the court when asked if she intended to appeal.

The 37-year-old now faces the possibility of 20 years behind bars for each conviction. She remains at liberty ahead of another hearing on the terms of her bail next week. No date was set for sentencing.

Holmes was hailed as the next tech visionary on magazine covers and collected mountains of investors’ cash, but it all collapsed after Wall Street Journal reporting revealed the machines did not work as promised.

Prosecutors spent 11 weeks presenting over two dozen witnesses, as they painstakingly laid out their argument that Holmes knew her technology fell short, and deliberately misled investors and patients.

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