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‘Limited financial resources’: Theranos fraudster Elizabeth Holmes claims she can’t pony up $250 a month after sentence

Elizabeth Holmes has blonde hair and is wearing a dark blue suit over a black shirt. She is standing behind a podium and partitions inside a wood-paneled courtroom and appears to be speaking to someone off-camera.

Former Theranos CEO Elizabeth Holmes arrives at federal court in San Jose, Calif., Monday, Oct. 17, 2022. (AP Photo/Jeff Chiu)

Convicted Theranos fraudster Elizabeth Holmes claims that she won’t be able to afford her $250-a-month restitution payments to her victims once she completes her 11-year sentence.

Holmes, 39, began serving her roughly decade-long sentence at Federal Prison Camp Bryan in Texas on May 30, 2023, the day after this past Memorial Day.

Forbes once touted Holmes as the world’s youngest and wealthiest female, self-made billionaire, and she counted the likes of News Corp chairman Rupert Murdoch, former Secretary of State Henry Kissinger, and Oracle founder Larry Ellison as investors.

Now, her attorney Kevin Downey says, Holmes has a vastly different financial outlook.

U.S. District Judge Edward Davila imposed a more than $452 million restitution order on Holmes and her accomplice Ramesh “Sunny” Balwani. But Downey noted that the judge treated the two defendants differently.

Balwani served as the chief operating officer for Theranos and was romantically involved with Holmes, who described him as an abusive boyfriend. Judge Davila dealt Balwani a tougher sentence spanning nearly 13 years, along with a $25,000 fine. The judge declined to issue a similar fine to Holmes, noting that he “reviewed” her financial statements.

Downey said that the judge has seen “substantial evidence showing Ms. Holmes’ limited financial resources.”

Last week, prosecutors moved to amend the judgments to allow Holmes to make small incremental payments after her release from prison. The government said the proposed changes were necessary to correct “certain clerical errors.”

“Once the defendant is on supervised release, the criminal monetary penalties must be paid in monthly payments of not less than $250 or at least 10 percent of earnings, whichever is greater, to commence no later than 60 days from placement on supervision,” Assistant U.S. Attorney Robert Leach wrote in a five-page filing.

Counsel for Holmes argues that there is no reason to make this change.

“Ms. Holmes’ amended judgment already includes a restitution schedule that begins while she is incarcerated,” Downey wrote. “There is no indication in the record that the absence of a change to the schedule after she is released was a clerical error.”

Theranos claimed to have developed a method to perform blood testing with an amount as small as a finger prick, dubbed the nanotainer, and at its height, the company rose to a $9 billion valuation. Its fall was just as precipitous. Wall Street Journal’s John Carreyrou investigated Theranos in a series of articles, then in a book titled “Bad Blood: Secrets and Lies in a Silicon Valley Startup.” HBO later turned the tome into a documentary.

A federal jury convicted her on conspiracy and wire fraud charges related to the company’s investors.

Balwani, 57, is now incarcerated at Federal Correction Institute Terminal Island, a low-security facility based in San Pedro, California.

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Law&Crime's managing editor Adam Klasfeld has spent more than a decade on the legal beat. Previously a reporter for Courthouse News, he has appeared as a guest on NewsNation, NBC, MSNBC, CBS's "Inside Edition," BBC, NPR, PBS, Sky News, and other networks. His reporting on the trial of Ghislaine Maxwell was featured on the Starz and Channel 4 documentary "Who Is Ghislaine Maxwell?" He is the host of Law&Crime podcast "Objections: with Adam Klasfeld."