In this case, fraud is far worse than theft. She defrauded investors of hundreds of millions of dollars and spent them on a what was essentially a vanity project. She destroyed hundreds of millions of dollars of private property.
Destroying 100 million is best compared to something like a "killdozer"[0] rampage. Holmes' crime was the destructive equivalent of leveling ~300 homes.
This is a pretty bold claim. Unwrapping the rhetoric, it sounds like you’re claiming that Holmes was given a harsher sentence because she’s a woman. However, the case is built on deliberate defrauding of investors to the tune of billions of dollars, if I understand it correctly. (I’ll admit to not paying close attention.) Do you have any examples of crimes of similar scope and how they were treated?
Eh disagree. Holmes got more than 10 years but she didn’t even try to profit by selling shares or borrowing against shares to buy a bunch of things. The scale of the financial fraud is enormous and on top of that they spent hundreds of millions of it on luxury items and influence peddling.
Not that this is the right forum to re-try her case, but I'm actually shocked she got 11 years and I might even argue that is far more than she deserves if she was acquitted on the patient side. The problem appears that these statutes are based on dollar amounts of the fraud -- $140 million according to https://www.justice.gov/usao-ndca/pr/elizabeth-holmes-senten.... Yes that's a lot of money but the investors themselves, how many of them were really damaged in any meaningful way? A few billionaires -- DeVos, Murdoch, Walton -- lost many millions, but what is that, 2 or 3% of their net worth? I'm sure there are some less-wealthy people on the investor list as well but I'm guessing nobody got their life savings wiped out. Defrauding the public, as opposed to some very wealthy investors, seems like a lot more serious crime.
I think the Holmes story is overblown. She was a media darling and doing TED talks and TV interviews. And all of a sudden she's the biggest fraudster since Charles Ponzi.
I understand that some companies succeed and some fail, some entrepreneurs do well and others pivot to do something else. Hers was no different.
What explains her story is that she must of pissed of certain people she shouldn't have... so they used all of the media and all of the political and legal power to take her down.
> Elizabeth Holmes just spent two years delaying her prison date, and she (and her co-conspirator) will only serve a decade for stealing ten times as much.
They didn't steal. They raised money from investors based on lies and squandered it. Of course, some of the cash made it back into their pockets, but it's not like they pocketed the whole $900m they raised based on their falsehoods.
A decade is very reasonable for intentionally, knowingly committing hundreds of millions of dollars worth of fraud and attempting to sustain it across many years of time.
She's little more than a highly skilled, pathological con-artist that worked over a very affluent system (Silicon Valley primarily).
It's not odd how vilified she has become. She appears to be severely deranged, has shown zero remorse for the crimes she committed, and has tried every trick in the bag to try to get out of taking responsibility legally for what she did.
> She faked it until she (didn't) make it--a strategy praised in other startup narratives.
That is not what she did. Holmes committed outright financial fraud by lying to - intentionally misleading - the investors and employees in just about the most epic way you could. She attempted to cover it up repeatedly, keeping the extent of their failures even from the board members whenever possible.
And last but not least, it's the highly regulated healthcare field (everyone here grasps the difference), not a little text search engine (eg Excite was a famous example of faking it until you make it during the dotcom bubble, they bid on a Netscape search deal, for promotion of their service, before they had the money to pay for it, on the basis that they could raise the money if they had the deal; however it's not usually a crime to commit to buy something before you have the money to do so).
One of the questions I have about any fraudster is where they fall on the goof/sociopath spectrum. It's surprisingly easy to start a Ponzi scheme by accident, after all. You just offer investors good returns (legal), be too optimistic about how it will go (legal), and then give them the promised returns anyhow by using other investor money (very illegal). I suspect a number of companies even get away with it, as they get in the black fast enough to be able to cover things up. But a lot of the people who get caught look to be eager-to-please fuckups, not calculating criminals.
But if I ever had any question about Holmes, it was richly answered for me by her having not one but two children while under indictment for crimes that yielded an 11-year sentence. I cannot imagine the kind of person who has kids knowing there were good odds they'd have to abandon them for much of their childhood.
Bernie Madoff ran a ponzi. He paid returns with other investor monies. Holmes ran a pure fraud. She put lives at risk with her tests. Potentially, peopled died. She deserves an extremely long and punitive jail sentence.
Holmes got federal prison time. Neumann did not. Arguably, Holmes did worse. Holmes was about to start selling snake oil, or rather snake oil blood test, which is essentially a medical fraud, although this is not the type of fraud that brought her to she to the prison cell.
Neumann took stupid VC money for a ride. Unethical? Yes. But they giving it to him very willingly. His actions arguably could do more damage, because maybe WeWork bankruptcy can finish off SF commercial real estate market – I don't know how much of their 13 billion lease obligations are in the city. But it's hardly his fault that the system is so brittle.
The prevalence of psychopathy is significantly higher among white collar managers than the general population (4% vs. 1% according to one of the few empirical studies https://onlinelibrary.wiley.com/doi/abs/10.1002/bsl.925)
Holmes, unlike most nonviolent corporate psychopaths, is only going to jail because she violated one of the only real cardinal rules of late stage capitalism, which is don’t intentionally defraud investors. She’s also one of the few psychopaths dumb enough to publicly and directly admit that she was maintaining a charade of a person who believes that other people and their emotions truly exist.
Im literally not disputing that she was a fraudster. And I'm not defending Holmes. All scams are frauds, not all frauds are scams. Being a scamster is a form of psychopathy that evinces a knowing willingness to hurt people in the name of self interest. Arguably my claim is scarier. Fraudsters like Holmes are scary because they don't think they are doing anything wrong. The fake it till you make it narrative even gives the perception of a long leash to commit pecadillos on the long road to success, in the context of the "make the world better" narrative of SV. There are more people out there like her, and it's harder to restrain them because they think they are doing something good and to boot they appear (maybe even are, if slightly) less psychopathic at a first glance.
IMO the reason Holmes deserves to be locked up for a long time is not just because of the fraud she committed, but the way she tried to use her power and her powerful friends to destroy people whose only crime was telling the truth.
Seriously, read Bad Blood, see what she tried to do to Tyler Schultz, Erika Cheung, and Rochelle Gibbons (the widow of the Theranos scientist that committed suicide), among many others. The best analogy I can think of is Lance Armstrong's fraud. Yes, his cheating and lying about it was bad, but I guess at least somewhat understandable given the culture of cycling at the time. But the reason I despise the man is due to his mafioso tactics of intimidation he used to silence people. Holmes did the exact same.
I think Holmes did actual damage that equals or surpasses some of these violent acts you enumerate. Medical tests that don't work is a serious crime. There are serious consequences to, say, an HIV test that doesn't work right. And she sold that with full knowledge that it didn't work.
Of course, she's being prosecuted for financial crimes and not this... I guess they got Al Capone on taxes.
Elizabeth Holmes was sentenced to 11 years and she didn’t steal any money for personal gain. Madoff was sentenced to 150 years.
Based on what we know so far about Caroline’s misuse (abuse) of funds and possible mass market manipulation all of which has resulted in billions of dollars in investor losses. 10 years in this case seems light, no?
Destroying 100 million is best compared to something like a "killdozer"[0] rampage. Holmes' crime was the destructive equivalent of leveling ~300 homes.
[0]https://en.wikipedia.org/wiki/Marvin_Heemeyer#The_'Killdozer...
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