In a ruling released Wednesday, Judge Edward J. Davila of the U.S. District Court for Northern California said the financial statements prepared by Ramesh Balwani “were not just forecasts, they were lies” and “a real evasion of fair business practices.” .
Balwani, 57, was found guilty of fraud and conspiracy in July over fraudulent claims about the company’s medical technology capabilities that put patients at risk.
Theranos announced that it has developed a device that can detect hundreds of diseases and other potential problems with just a few drops of blood taken from a finger.
Even though the company knew the technology was inaccurate, the company continued to raise money from investors, including billionaires like Larry Ellison, former head of technology at Oracle, and media mogul Rupert Murdoch, and started selling the devices in stores.
Balwani’s sentence was less than the 15 years in prison requested by federal prosecutors, but significantly longer than the four to 10 months requested by defense lawyers.
The U.S. Attorney’s Office also asked Edward J. Davila to impose $804 million (€765.5 million) in investor compensation on Balwani. The judge delayed the decision until a later hearing.
Davila had already sentenced Theranos founder and former Balwani partner Elizabeth Holmes to 11 years in prison on Nov. 18 and a $121m (€116m) settlement to ten investors.
The Silicon Valley, California-based company, which was valued at more than ten billion dollars (about 9.6 billion euros), was dissolved in September 2018.
Since the Theranos fraud case was uncovered in 2015, the story of the 38-year-old Holmes has been featured in numerous media content, including television series, documentaries and podcasts.
