Elizabeth Holmes, the founder of US start-up Theranos, will begin serving her prison sentence on 30 May for defrauding investors in the failed blood-testing company once valued at $9bn.
Holmes – along with former CEO Ramesh “Sunny” Balwani – has also been ordered to pay $452m to victims of the company’s fraud, with an Appeals Court denying her request to remain out of prison while challenging her conviction.
Holmes, who had claimed that Theranos could run an array of diagnostic tests with just a few drops of blood, was convicted last year of misrepresenting the firm’s technology and finances, reports Reuters. She was sentenced to 11 years and three months in prison.
Under the restitution order made by Judge Edward Davila in San Jose, California, who also oversaw Holmes’ trial and sentencing, both Holmes and Balwani are equally responsible for the full amount.
Davila rejected their argument that intervening events contributed to Theranos investors’ losses.
“The victims’ losses occurred the moment they exchanged their money for Theranos shares,” the judge said.
Holmes had asked the Appeals Court to pause her sentence on 25 April, two days before she was to report to prison, but it rejected her argument that the appeal would probably result in a new trial, the threshold for her to remain free on bail.
Balwani was convicted of defrauding Theranos investors and patients at a separate trial and sentenced to 12 years and 11 months in prison. He began serving the sentence on 20 April, after Davila rejected his requests to remain free on bail during his appeal.
Holmes was dubbed the world’s youngest female self-made billionaire in 2014, when she was 30 and her stake in Theranos was worth $4.5bn. The company collapsed after a series of Wall Street Journal articles in 2015 questioned its technology.
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