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Both Balwani and Theranos founder Elizabeth Holmes face up to 20 years in prison for defrauding investors in the blood-testing company.
Ramesh ‘Sunny’ Balwani, the former chief operating officer of Theranos, has been convicted of fraud.
It comes six months after the founder and former CEO of the failed blood-testing start-up, Elizabeth Holmes, was also convicted of fraud after the court found her guilty of four of 11 charges against her.
Balwani has now been convicted of all 12 charges laid against him at a court in California.
He has been convicted of defrauding investors and patients by claiming that the tech behind Theranos – which could purportedly detect a plethora of diseases from just a few drops of blood – worked.
Holmes and Balwani, who were once in a relationship, will be sentenced later this year and are each facing up to 20 years in prison.
What happened to Theranos?
At its peak, Theranos was valued at $9bn and Holmes became a star in Silicon Valley and a billionaire by the age of 30.
Theranos had big backers, including media mogul Rupert Murdoch, Oracle founder Larry Ellison, Walmart’s Walton family and the family of US billionaire Betsy DeVos.
But the medtech start-up began to fall as fast as it rose after the Wall Street Journal’s John Carreyrou published reports in 2015 featuring several company whistleblowers who claimed the tech didn’t work as promised.
In 2019, whistleblower Erika Cheung told Silicon Republic’s Inspirefest event about her role in revealing the truth behind the company.
“The technology didn’t work,” she explained at the time. “The devices were nothing more than wishful thinking.”
Theranos dissolved in 2018 after civil and criminal probes, and Holmes and Balwani were indicted.
‘I am responsible for everything at Theranos’
As well as a prison sentence, Balwani may also have to pay millions of dollars in restitution payments to Theranos investors and patients.
During the trail of Holmes in January, she also accused Balwani of abuse – a claim he denies.
In Balwani’s trial, prosecutors showed text messages from 2015 sent by him to Holmes, according to BBC News, that read: “I am responsible for everything at Theranos. All have been my decisions too.”
This was described as an admission of guilt by US attorney Jeffrey Schenk. “He’s acknowledging his role in the fraud,” he said.
“We are obviously disappointed with the verdicts,” Balwani’s attorney Jeffrey Coopersmith said, according to CNBC. “We plan to study and consider all of Mr Balwani’s options including an appeal.”
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