Theranos's general counsel, David Taylor, has been appointed CEO.
Investors were subjected to further falsehoods when Holmes and Balwani told them their company had a profitable and revenue-generating relationship with the Pentagon, and that Theranos' system had been deployed to the battlefield, when in fact the firm had "limited revenue" from military contracts and its technology hadn't seen the field of battle. However, federal prosecutors say Holmes and Balwani engaged in a multi-million dollar scheme to defraud investors and a separate scheme to defraud doctors and patients, alleging the two of them knowingly lied about the accuracy and reliability of some of their products.
Holmes, who started Theranos at the age of 19, was celebrated as a rising star of Silicon Valley until it became clear that numerous claims about the company's supposedly revolutionary blood test were bogus.
Holmes and Ramesh "Sunny" Balwani, the former president and COO of Theranos, were both charged with two counts of conspiracy to commit wire fraud and nine counts of wire fraud.
But an investigation by The Wall Street Journal two years ago found that Theranos' technology was inaccurate at best, and that the company was using routine blood-testing equipment for the vast majority of its tests.
The Justice Department announced an indictment Friday against former tech world wonder woman Elizabeth Holmes, saying her claims of having created a revolutionary blood test were a sham.
The indictment also alleged that Holmes and Balwani made numerous misrepresentations about Theranos' financial condition and futures prospects. Mr. Balwanibelieved so much in Theranos that over the years his own mother and other family membersused the company's lab to enable them to make informed decisions about important health carematters.Mr. Balwani looks forward to trial because he did not defraud anyone, and it will be an honor todefend him vigorously. On Wednesday, March 14, 2018, the Securities and Exchange Commission filed charges against Holmes and her company for defrauding investors.
Think your friends would be interested? At one time, Theranos was worth more than $10 billion and Holmes the youngest self-made female billionaire. A lawyer for Holmes didn't respond to a request for comment.
FILE PHOTO: Theranos Chief Executive Officer Elizabeth Holmes speaks on stage at the Glamour Women of the Year Awards where she receives an award, in the Manhattan borough of NY, U.S., November 9, 2015.
It's unclear how many people still work at Theranos, which has had to lay off the vast majority of its workers in the face of mounting scandals.
As the roll-out with Walgreens neared, Holmes told the company's engineers to modify standard blood-testing machines to run Theranos's tests, according to the SEC.