If there were an Elizabeth Holmes clone that had been punished 10 years prior for some similar con, would this Elizabeth Holmes have not become a con artist?
I don’t think anything would have deterred her. She’s a psychopath. I would not have been surprised in the least if it had come out in the trial that she hired a hitman.
The legal system has numerous functions. One of them is deterrence. Another one is rehabilitation. But one function a lot of people don’t like is retribution and simple removal.
Removing dangerous people and frauds from the streets makes society safer at the margins. It’s an ugly business but I can’t see a way around it.
Maybe Elizabeth Holmes, that specific person, still would; but there would definitely be less con artists around. Currently being a con artist must have the highest reward/risk ratio among all professions.
Maybe. Maybe not. We obviously can't predict individual cases, but in general the entire Silicon Valley "fake it till you make it" ethos was definitely responsible for how her life turned out. And I'm sure the Theranos case has directly led to at least some investors doing more due diligence and holding their founders more responsible for results (though sadly still not close to enough).
I think the most interesting thing about Liz's character is how she didn't skip a beat when she got indicted. She just kept rolling along. Kicked Sonny to the curb like it was nothing, tried and failed to blame the whole thing on him, found a rich guy to marry, had 2 kids and just kept trucking along like the whole fraud thing was just a big misunderstanding.
The complete lack of empathy or concern for her victims, contrition or anything is amazing to watch.
This lack of belief that she would ever be found out or anyone would care about her lack of concern for people was her downfall. She could have just bailed out before the Walgreens deal when the whole thing was obviously not going to work and failed in the normal way that science project startups fail.
She could have then married the rich guy and had the two kids and lived a dull life maybe selling diet pills or whatever, but she just had to go all in to the fraud and wreck her life because she thought she could just power through on delusional belief alone.
> but she just had to go all in to the fraud and wreck her life because she thought she could just power through on delusional belief alone.
... which is actually a completely reasonable assumption from her perspective.
People at her level of power being held accountable is the one-in-a-thousand exception. It almost never happens. In a very real sense, she was just extremely unlucky, and had undoubtedly witnessed countless others commit worse crimes without any negative consequences for them.
This is also the answer to questions like "How did those cops think they could get away with murdering a man in cold blood while being filmed by half a dozen cameras?" It's easy: Because they had seen others get away with it, time and time again. Statistically speaking, a cop murdering an innocent citizen has about as much to fear as a regular guy parking in the wrong spot. Indictments are not the rule, never mind convictions.
Enron wasn't just a one-in-a-thousand exception, it was a one-in-a-million exception. You have to go back to the early 20th century to find another case of the government coming down this hard on a large company, and it certainly hasn't happened again since.
The standard process for many decades now is that a company caught committing crimes pays a certain amount of money (nowhere near enough to threaten its existence in any way), and then can continue operating essentially as before.
Almost every Diesel vehicle Volkswagen produced for many years was fraud. The company designed those vehicles, with criminal intent, to deceive regulators (and customers!) into believing the product was something that it actually wasn't.
How is that different from what Theranos did? Theranos fraudulently claimed their blood test was capable of quantifying various factors. It wasn't. Volkswagen fraudulently claimed their cars were capable of meeting emissions standards. They weren't.
Yet Volkswagen is still allowed to operate, even though their business ran on fraud for a long time.
VW's cars existed and were drivable. In fact owners of their cars were probably pretty happy with the product they had purchased till the scandal emerged. Theranos' product never worked in any way that anyone, consumer or regulator would have deemed acceptable.
VW has other products than their diesel cars. Theranos had nothing but the non-functioning diagnostic.
Well yes. But what I meant was that at the time it collapsed, it was all fraud. There was no real business profitable business to continue. Fraud was what it did by the end.
I worked a little investment firm in college. A few years ago I looked up my boss, the owner. Found out he was in prison! For stealing $10m from a bunch of retirees in a really careless, sloppy way.
I think a surprising amount of people try it. But every SEC indictment is not news so we don't hear about the people who go to prison.
But you don't know how often people get away with it, because they get away with it. Maybe people get away with it 99 times out of a hundred, in which case scamming might be rational to somebody with no morals. But maybe the odds of eventually getting caught are much higher than the popular narrative would have you believe. Then immoral people like Holmes, with a feeling of entitlement and belief in ineffectual enforcement, get lured into a trap lifestyle that will more likely than not ruin their lives.
I worked for a guy that ended up embezzling for the next company (a consortium) that he fronted , when he was caught (met by sheriffs at SFO) the European members of the consortium wanted blood, the US ones wanted to sweep it all under the carpet - he walked away - last time I checked he was a VC
There was at least one war criminal on her board, while several other war criminals in the country are enjoying their retirement, so no, that's not just a narrative. People like her literally get away with murder, all the time.
The "money is power" is not just a nice phrase from books. Money is power over how much effort others will spend to solve the problems of those who pays the money. So it's literally power.
However there're also other ways to control others to solve problems involuntarily.
Exploitation is the area in which the civilization is exceptionally strong.
So yes, starting from some level of money and power it's pretty easy to get away with proportinally more and more with the money and power increase.
> it's pretty easy to get away with proportinally more and more with the money and power increase
The power/money creates a inbalance with the punishment ( it has less side effects to do it). Either by people being influenced of your status or the fine not being relational to your wealth.
Untill you overdo it, which may be the situation with the previous president.
If you read the account of Anna Delvey’s fraud, you get a sense of how close she came to getting away with it. https://www.thecut.com/article/how-anna-delvey-tricked-new-y... I don’t know how common it is, but Holmes had the connections and experience to make something like that work I think.
I don't buy this at all. People at this level of power are held accountable if they make easily identified crimes where their individual culpability can be proven. Heck, even Holmes own criminal judgement shows that. I know the Internet's take on the situation was "She was only convicted for stealing from rich people, but not for defrauding normal patients, because the justice system only cares about rich people." That's BS. It's just simply that there was much more of a "smoking gun" that showed her directly lying to investors to get their money, while it's at least plausible she thought she could generate accurate results for patients since in many cases they were taking full blood draws anyway.
Besides, it's impossible that Holmes crimes wouldn't ever be discovered. I commented elsewhere, but the technology Theranos was selling was simply impossible - capillary blood at very small volumes is simply not homogeneous enough to give accurate results for quantitative tests. Holmes jumped off a cliff without a parachute and thought that if she gave enough glowing interviews to credulous news outlets that she could somehow keep from hitting the ground.
Yeah, honestly, like a lot of cases like Holmes, for me the worst part is not the fraud, it's the complete willingness to completely ruin anyone that gets in her way that makes her so diabolical. The book Bad Blood makes it pretty clear how she pretty much threatened to destroy anyone that did the simple act of telling the truth. Her subsequent disregard for patients, Sonny as you put it, and heck her 2 kids in my opinion show how much she just does not care about other people.
IIUC the GP's argument is that she active sought to have children after being charged primarily for the purpose of attempting to sway the courts and the public opinion lest that fail — without any consideration on the effects her actions might have on those children.
regarding her victims. She has only been convicted for defrauding powerful investors like Shultz, Murdoch, Kissinger, etc. who failed to do due diligence.
She has not been convicted for defrauding customers/patients or her employees.
Tells much about current state of justice system… Well at least she was stopped.
The same thing happened with the Fyre Festival. The organizers didn't face consequences from defrauding the people they sold tickets to. They face consequences from defrauding the investors.
That's why they put the hammer down on Bernie Madoff - he stole from the ultra wealthy. If he had been robbing the little people he would have, at most, spent a couple of years at Club Fed.
how much effort should the prosecutors spend on prosecuting more challenging charges, when they had a bunch of easy ones? are they morally obligated to prosecute every single charge that might apply?
I hate this take because I hear it all the time and it's simply incorrect, at least in relation to Holmes' case.
In a court of law you need to prove your case, with evidence, beyond a reasonable doubt. The evidence that Holmes lied to investors for the purposes of getting money, and that she knew she was lying and did it purposefully, was undeniable - there were too many smoking guns. The evidence that she knew she was defrauding patients was always less clear cut.
Besides, the prosecutors did try mightily to convict her of crimes against patients. Are you saying the 12 randomly selected jurors who found her not guilty of these crimes are in cahoots with "the current state of the justice system"?
She could have just bailed out before the Walgreens deal when the whole thing was obviously not going to work and failed in the normal way that science project startups fail.
how would that have worked? it was a fraud before then.
> Theranos founder Elizabeth Holmes reportedly told a Walgreens consultant that “They don’t put pretty people like me in jail,” according to a government filing ahead of the sentencing hearing Friday.
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.
From https://www.nytimes.com/2023/05/07/business/elizabeth-holmes...: At one point, I tell her that I heard Jennifer Lawrence had pulled out of portraying her in a movie. She replied, almost reflectively, “They’re not playing me. They’re playing a character I created.”
Holmes is a textbook psychopath, i.e. "deficient emotional responses, lack of empathy, and poor behavioral controls, commonly resulting in persistent antisocial deviance and criminal behavior" https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4321752/
She may be a sociopath, but I don’t think being pregnant is proof. Prison sucks and ten years is a long time: id probably try to gain sympathy points as well.
Maybe not, but I come from the lower class where jail is just a normal thing that happens to people and everyone has friends who’ve been. If I were a woman from a fairly well off family I think having a baby for sympathy wouldn’t be that big of a stretch.
I’ve seen people do strange things to try and get sympathy from a jury. Not adopt a child crazy, but being pregnant really doesn’t seem that odd to me and indeed seems like a common thing women facing extended prison time would do.
To be honest: I think her thinking was that her biological clock would run out by the time she got out of prison, so she decided to have a baby or two while she could.
It's very hard to guess her thinking, because the limits, considerations, and guesses about the future that most people have aren't ones that she would have.
I think she thought she'll never go to prison, just like she thought her startup would work, despite all the scientific knowledge against it. So why not get pregnant?
I think she's really a much worse person than you give her credit for. Like I said, I think she had a kid just to avoid prison. The kid is a disposable accessory. Time will tell; interview the kids in 20 years. She even dropped her fake voice... she went all in on trying to re-work her image to get sympathy from the jury.
The world may have dodged a bullet in that when she was shopping around for a rich husband she didn’t stumble across SBF. Those kids may well have come out with a pitchfork and hooves.
Although quite uncharitable, I can believe this has some truth to it. She underwent a visible transformation for the trial, wearing her hair down and changing her entire mien. Quite a contrast to her appearance during the Theranos years.
I don't think this is a reasonable take. She's 38 years old and will serve roughly 10 years. It is not in fact normally the case that having a child gets you out of federal prison time. It's much more likely that this was her last opportunity to have kids, given her timeline, and she took it. The kids will do fine. They have a stable family situation.
Coming from other angle. She might have gotten kids to lock up the marriage or at the least the alimony. Even despite conviction. I think we must be honest that this often happens.
I still think it's a bit tragic, if they'd just abandoned the quantitative claims and stuck to +/- detection strategies (suitable for Covid testing, STD detection, etc) they might have become something that we'd be talking about positively today, a hero of the Covid outbreak because they were all set up to do comprehensive testing.
That's what microfluidic approaches with small samples are good for, detecting presence/absence of a marker within a defined limit of detection. Anyone with even basic domain knowledge would have known that the quantitative stuff couldn't be done on microfluidic samples...
It's a really strange story, as they got all these military-government people on board, and that led to more trust from outside investors, and it just kept rolling... yet anyone like myself or dozens of others with experience in that field could have told them it was all BS if consulted. Go figure.
I think the microfluidic testing could have worked with ML and computer vision. I believe there was/is an Israeli startup working on it a few years after Theranos.
I heard that the reason why it can't be done is that to get those quantitative measurements you have to react the blood sample with certain chemicals. To do multiple tests you need enough blood that you can divide it up into samples and react each one separately. So if you only start off with one drop its hopeless to run the full suite of tests.
No, it is physically impossible to run quantitative tests on very small amounts of capillary blood. There have been studies (can dig them up but you can Google for them) that show that capillary blood simply is not homogenous enough at these one drop volumes. Meaning it doesn't matter how good your technology is, it's just not possible.
There is nothing, zero, nada of value in Theranos' research. What difference would it have made if they just "stuck to +/- detection strategies"? All of these tests already exist, heck there are lots of at home tests you can already run with a few drops of blood from a finger prick (or, in the case of Covid, no blood at all).
so these delusions of grandeur is what's weird to me with these startups. I just got out of one of many years where the decision was made to double-down on the failed approach and "we'll find our customer eventually". That translates to many more years of headed in the wrong direction with nothing to show for it, all for a delusional hope to become a unicorn (no less) some day.
Why can't people just settle for a safer bet after the failure becomes apparent? Perhaps if Theranos started selling more traditional tests, even like home tests, they would lose the unicorn status but they would still have a (smaller) business and people would not go to jail? But no, had to be a 100% scam and crash everything into the wall.
Well, perhaps not as far as known, but the general microfluidic platform they were working with was supposed to at least be capable of microfluidic capabilites (i.e. comparable to a DNA microfluidics system for DNA sequencing of the kind developed ~20 years ago).
If that was working, now imagine a chip platform, a small wafer or plate containing ID sequences of the top 100 known human infectious diseases, in that situation possibly you could get a one-shot test using just 200 ul of blood, distributing 2 ul to each (non-quantitative, +/- test). Then you'd test it, see what your limit of detection is and so on. If this was automated and reliable, it'd be very valuable for many different purposes (you could also have specialized chips for all known respiratory viral types, all common water-borne pathogens, all known STDs, etc)
Of course, that'd be a much smaller market, maybe only a fraction of the value of the whole quantitative blood component level testing industry.
Not sure if we are agreeing with each other or disagreeing, but what you are describing had absolutely nothing to do with what Theranos was actually researching and working on. So sure, I think it's possible to say "Man, if only Theranos was working on something totally different from what they were selling to investors and the public, there could have been something!"
I feel sorry for Sunny Balwani (OK, not too much, but just a little). Poor guy let his little head do the thinking and fell for her charms. Now he must pay almost $226M to people like Murdoch. He lost everything. Guy was well off from his previous startup(s), but I guess it's back to square one now. Hopefully he'll learn some survival skills in prison.
You know, the most dystopian thing isn't that a woman became rich by making fake medical test machines. It's that she was prosecuted for screwing over other rich people, not the negligent murder of an unknown number of poor people due to deliberately faked medical tests.
For me it's the fact that these restitution orders are exclusively to corporations and investors, while the blood tests all originated from real people having real diseases needing real treatment. It's safe to say many of these patients suffered adverse effects in one way or another, yet sociopathic capitalism rules the day.
My favorite thing about Elizabeth Holmes is what she said to NYT reporter Amy Chozick when Amy mentioned that Jennifer Lawrence had declined to play Holmes in The Dropout:
> They’re not playing me. They’re playing a character I created.
When Ms. Choszick asked why she would do such a thing, Elizabeth said,
> I believed it would be how I would be good at business and taken seriously and not taken as a little girl or a girl who didn’t have good technical ideas. Maybe people picked up on that not being authentic, since it wasn’t.
I don't know why, but I'm still surprised the voice was totally fake.
Before her downfall I thought it was some type of strange misogyny to accuse her of that. A lot of it was still misogyny, but turns out that part was right.
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[ 1.8 ms ] story [ 86.0 ms ] threadThe legal system has numerous functions. One of them is deterrence. Another one is rehabilitation. But one function a lot of people don’t like is retribution and simple removal.
Removing dangerous people and frauds from the streets makes society safer at the margins. It’s an ugly business but I can’t see a way around it.
Probably not. But she wouldn't have gotten the scale she had.
In most cases the perpetrators do not even get jail time. Pay a fine and move on.
The complete lack of empathy or concern for her victims, contrition or anything is amazing to watch.
This lack of belief that she would ever be found out or anyone would care about her lack of concern for people was her downfall. She could have just bailed out before the Walgreens deal when the whole thing was obviously not going to work and failed in the normal way that science project startups fail. She could have then married the rich guy and had the two kids and lived a dull life maybe selling diet pills or whatever, but she just had to go all in to the fraud and wreck her life because she thought she could just power through on delusional belief alone.
... which is actually a completely reasonable assumption from her perspective.
People at her level of power being held accountable is the one-in-a-thousand exception. It almost never happens. In a very real sense, she was just extremely unlucky, and had undoubtedly witnessed countless others commit worse crimes without any negative consequences for them.
This is also the answer to questions like "How did those cops think they could get away with murdering a man in cold blood while being filmed by half a dozen cameras?" It's easy: Because they had seen others get away with it, time and time again. Statistically speaking, a cop murdering an innocent citizen has about as much to fear as a regular guy parking in the wrong spot. Indictments are not the rule, never mind convictions.
The standard process for many decades now is that a company caught committing crimes pays a certain amount of money (nowhere near enough to threaten its existence in any way), and then can continue operating essentially as before.
Same as Theranos. It was fraud.
It is a massive mistake to conflate stuff regular companies do which may be illegal or distasteful, with companies that are entirely fraudulent.
How is that different from what Theranos did? Theranos fraudulently claimed their blood test was capable of quantifying various factors. It wasn't. Volkswagen fraudulently claimed their cars were capable of meeting emissions standards. They weren't.
Yet Volkswagen is still allowed to operate, even though their business ran on fraud for a long time.
VW has other products than their diesel cars. Theranos had nothing but the non-functioning diagnostic.
This isn't true. Read The Smartest Guys in the Room. Enron started out as a real company and slowly became increasingly fraudulent with time.
I think a surprising amount of people try it. But every SEC indictment is not news so we don't hear about the people who go to prison.
But you rarely hear about the ones that tried it and got away with it, because they got away with it.
However there're also other ways to control others to solve problems involuntarily.
Exploitation is the area in which the civilization is exceptionally strong.
So yes, starting from some level of money and power it's pretty easy to get away with proportinally more and more with the money and power increase.
The power/money creates a inbalance with the punishment ( it has less side effects to do it). Either by people being influenced of your status or the fine not being relational to your wealth.
Untill you overdo it, which may be the situation with the previous president.
Besides, it's impossible that Holmes crimes wouldn't ever be discovered. I commented elsewhere, but the technology Theranos was selling was simply impossible - capillary blood at very small volumes is simply not homogeneous enough to give accurate results for quantitative tests. Holmes jumped off a cliff without a parachute and thought that if she gave enough glowing interviews to credulous news outlets that she could somehow keep from hitting the ground.
She has not been convicted for defrauding customers/patients or her employees.
Tells much about current state of justice system… Well at least she was stopped.
In a court of law you need to prove your case, with evidence, beyond a reasonable doubt. The evidence that Holmes lied to investors for the purposes of getting money, and that she knew she was lying and did it purposefully, was undeniable - there were too many smoking guns. The evidence that she knew she was defrauding patients was always less clear cut.
Besides, the prosecutors did try mightily to convict her of crimes against patients. Are you saying the 12 randomly selected jurors who found her not guilty of these crimes are in cahoots with "the current state of the justice system"?
how would that have worked? it was a fraud before then.
> Theranos founder Elizabeth Holmes reportedly told a Walgreens consultant that “They don’t put pretty people like me in jail,” according to a government filing ahead of the sentencing hearing Friday.
The arrogance.
https://www.wsj.com/livecoverage/elizabeth-holmes-sentencing...
A similar story: Judge Rules White Girl Will Be Tried As Black Adult https://www.youtube.com/watch?v=84phU8of02U
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.
Source?
Holmes is a textbook psychopath, i.e. "deficient emotional responses, lack of empathy, and poor behavioral controls, commonly resulting in persistent antisocial deviance and criminal behavior" https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4321752/
I’ve seen people do strange things to try and get sympathy from a jury. Not adopt a child crazy, but being pregnant really doesn’t seem that odd to me and indeed seems like a common thing women facing extended prison time would do.
https://news.ycombinator.com/item?id=28693855
I still think it's a bit tragic, if they'd just abandoned the quantitative claims and stuck to +/- detection strategies (suitable for Covid testing, STD detection, etc) they might have become something that we'd be talking about positively today, a hero of the Covid outbreak because they were all set up to do comprehensive testing.
That's what microfluidic approaches with small samples are good for, detecting presence/absence of a marker within a defined limit of detection. Anyone with even basic domain knowledge would have known that the quantitative stuff couldn't be done on microfluidic samples...
It's a really strange story, as they got all these military-government people on board, and that led to more trust from outside investors, and it just kept rolling... yet anyone like myself or dozens of others with experience in that field could have told them it was all BS if consulted. Go figure.
Why can't people just settle for a safer bet after the failure becomes apparent? Perhaps if Theranos started selling more traditional tests, even like home tests, they would lose the unicorn status but they would still have a (smaller) business and people would not go to jail? But no, had to be a 100% scam and crash everything into the wall.
If that was working, now imagine a chip platform, a small wafer or plate containing ID sequences of the top 100 known human infectious diseases, in that situation possibly you could get a one-shot test using just 200 ul of blood, distributing 2 ul to each (non-quantitative, +/- test). Then you'd test it, see what your limit of detection is and so on. If this was automated and reliable, it'd be very valuable for many different purposes (you could also have specialized chips for all known respiratory viral types, all common water-borne pathogens, all known STDs, etc)
Of course, that'd be a much smaller market, maybe only a fraction of the value of the whole quantitative blood component level testing industry.
> They’re not playing me. They’re playing a character I created.
When Ms. Choszick asked why she would do such a thing, Elizabeth said,
> I believed it would be how I would be good at business and taken seriously and not taken as a little girl or a girl who didn’t have good technical ideas. Maybe people picked up on that not being authentic, since it wasn’t.
https://www.nytimes.com/2023/05/07/business/elizabeth-holmes...
This bitch is as pure and distilled a psychopath as we are ever likely to see.
Is it relatively objective and close to the facts? Or a sensationalized drama without much value?
Before her downfall I thought it was some type of strange misogyny to accuse her of that. A lot of it was still misogyny, but turns out that part was right.