By Samantha Masunaga Los Angeles Times
WWR Article Summary (tl;dr) According to the Justice Department, Holmes and former company COO Ramesh "Sunny" Balwani engaged in a "multi-million scheme to defraud investors"
Los Angeles Times
Theranos Inc. founder Elizabeth Holmes and former company Chief Operating Officer Ramesh "Sunny" Balwani have been charged by a federal grand jury of wire fraud and conspiracy to commit wire fraud, the Justice Department said Friday.
According to the Justice Department, the two engaged in a "multi-million scheme to defraud investors" and were also involved in a separate plan to "defraud doctors and patients."
Minutes before the Justice Department's announcement, Bloomberg reported that Holmes stepped down as Theranos' chief executive but that the Silicon Valley company said she would remain chair of the board.
Theranos did not immediately respond to a request for comment.
Four years ago, Theranos was valued at $9 billion and Holmes was hailed as a potentially revolutionary force in the blood-testing industry. The company wowed a star-studded cast of investors and board members.
In March, Theranos settled charges by the U.S. Securities and Exchange Commission, which said the company was conducting a "massive fraud" in which its proprietary technology never worked as advertised.