Elizabeth Holmes may have to think about a career change. The SEC today charged the Theranos founder, and its president Ramesh “Sunny” Balwani, with allegations of fraud. Holmes, the SEC says, has agreed to pay a $500,000 penalty. She is also “barred from serving as an officer or director of a public company for 10 years.” (In agreeing to this settlement, Holmes neither confirms nor denies the agency’s charges against her.)
The SEC found that Theranos top brass raised money from investors by touting false claims. In its press release, the agency writes that the company raised “more than $700 million from investors through an elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business, and financial performance.”
For example, in 2014 Theranos told investors that its technology was being used by the Department of Defense and was bringing in more than $100 million in revenue. “In truth, Theranos’ technology was never deployed by the U.S. Department of Defense and generated a little more than $100,000 in revenue from operations in 2014,” the SEC says.
Beyond the penalty, and agreeing to not lead a company, Holmes is also forfeiting her shares of Theranos. You can read the full press release here.