Holmes was found guilty of one 18 USC 1349 charge, and 3 18 USC 1343 charges; the 1343's she was found guilty on were in amounts ranging from $100k to $100MM(!).
It should be possible to come up with a better guess than the New York Times' "20 years per count, but likely served concurrently".
Argh! The linked NPR article on that tweet had me yelling at my phone:
> It is unusual for tech executives to face criminal changes when their startups collapse under the weight of unrealized promises.
That's because it's not illegal to over promise about your future results. It is illegal to lie about simple facts regarding the present state of your business to attract funding.
I'm so sick of so many press outlets framing this as just "fake it til you make it" gone wrong, "a page from the Silicon Valley playbook", or that it's just an over hyped company take to extremes.
No, Theranos was outright, egregious fraud, and most startups that "collapse under the weight of unrealized promises" are not committing fraud.
> No, Theranos was outright, egregious fraud, and most startups that "collapse under the weight of unrealized promises" are not committing fraud.
Most startups don't get the traction and publicity that Theranos got, however. I wouldn't be surprised if a lot of founders would go to similar lengths given the chance; they just happen to have someone apply some reality check on them before things get out of hand.
Look, there is still a big jump from the usual founder sharing partial vague optimistic statments (e.g., "our algorithm is great"), to the not so common direct lie (e.g., "we tested it with statistical significance, it works, here you can see these results on these real world inputs", while completely faking the results)
There`s a difference. I worked in a few startups. We make promisses that we can expect to accomplish in the future, we where clear that whatever we where working was still a prototipe or a promissing idea, but it was not ready.
She was going to great lenghts, saying her machine was already ready to production, and able to do acurate blood tests, when she knew it was impossible, and was using regular blood tests to fake results.
It happens more than you think, in many cases it’s easier to just sweep under the rug and move on. Few VCs want to admit they were swindled, and even fewer want the industry perception that they get founders investigated for fraud when things go sideways.
Theranos was unique in both the scale of the fraud and how non-investors were potentially harmed. Most of these are just founders who knowingly or unknowingly get in over their head and then basically walk away after having lied about the state of things.
I’ve heard a bunch of stories from VC friends, but the one I was the most involved with directly was probably 10 years ago. My mom mentioned to me that she had been chatting with some senior local government official who mentioned they had a startup datacenter provider taking over a nearby abandoned office complex and converting it to a green datacenter, bringing hundreds of jobs to the area - had I heard of them?
I had not, and after some digging determined that the company had claimed to have a bunch of unique technology, and leveraged that to get preferential terms from the local government - free rent, no property or payroll taxes, and other cash- and non-cash concessions. They had also raised millions from private investors by saying they had active datacenters with customers and they needed money to expand.
Except none of it was true. They had no customers, no datacenters, no employees other than the three founders and one of their daughters. They had made commitments in three different locations over the past three years to build a datacenter while simultaneously raising money by saying they ALREADY had active datacenters and customers.
I shared this with my mom, who shared it with local government, who hand waved it away as nonsense. But nothing ever happened at any of these sites, and after they ran through the money they filed for bankruptcy with revenue of $0 and assets of ~$12k. Their biggest investor took control of their land lease from the local government. Some investors complained online about being lied to, and the local government quietly swept it under the rug. I spoke with a local business reporter who basically shrugged and said, “yup, you’re right, but no one wants to talk about it”.
Under-engineered, if anything. If they had spent more time on development, a simpler machine could have been built. "Insert your favourite bridge building quote"
You’re right about the colloquial definition but I think the OP is more on point about the crux of the issue. Most physical world engineering applications are about the skill of stripping away as much as possible and still getting the job done. It’s an exercise of working within constraints. “Over-engineering” is ignoring those constraints.
"Perfection is achieved not when there is nothing more to add, but when there is nothing left to take away. Now please take away this overpriced juicer."
Definition written by management who can't tell good from bad. Ya see too many engineers got involved I reckon, should done what I told em, keep it simple fellas.
Wasn't her and the companies case that they knew what they wanted to achieve, wearing the bandaid that communicates with the phone to the server was impossible and that its various simpler versions of devices did produce results that did knowingly mislead people about their health. That's is potentially life threatening and different from an i.e. chat AI company that blatantly lies, this may lead to some peoples misery as well, but Theranos had way less network hops leading to health threatening outcomes.
Agreed, but there's a non zero number of startups I had first hand experience with that I would define fraudulent without hesitation. They just didn't become as big or raised enough money to matter.
Yeah, that's a surprising thing for him to say, since he's generally one of the loudest voices against this "add up the sentences" stuff. The grouping rules are in the sentencing guidelines too! Go look!
He was just responding to this paragraph in the NPR article:
> Holmes' sentencing date has not yet been set. But she faces the maximum penalty of 20 years behind bars, though legal experts say she will likely face a lesser punishment.
That is, he wasn't arguing that she will serve the max of 65, just that the max is much higher than what NPR reported.
It's not surprising, because there's a very good argument that the guideline range for what she has been convicted of (and taking into account her conduct at trial, which is relevant) is life, with the actual sentence capped at the statutory maximum of the offenses stacked consecutively rather than concurrently.
Now, it's possible that the court wouldn't agree with that analysis and find slightly fewer points, or that it would agree but would make a downward departure, but...
For another, because the guidelines are pretty specific in this case --- that 2B1.1 crimes are charged according to --- well, here's the wording from the guidelines: "the applicable base offense level is determined by the count of conviction that provides the highest statutory maximum term of imprisonment.". So "3x20" seems off the table.
The thing here is, you get up to around 20 years just with a single wire fraud count, because the amounts involved here are so high. We're at $143MM in losses on the three wire fraud charges together (2B1.1 states they're to be summed up), which gets you a 26(!)-level enhancement from the base level of 7. That's 12 years (at the bottom of the range), and every other enhancement you take after level 33 is another ~4 years; there are 3-4 enhancements (like "sophisticated means") that seem likely to apply.
On the flip side, given the huge sums involved, it's not easy to make the numbers make sense served consecutively.
Yes there's lots of very high and very low guesses as to what she might get going around. I'm just commenting here specifically on this twitter guy's opinion.
Yikes. Plus, my understanding is that > 10 means no minimum security camp and > 20 means no low security, so she would start off in medium security. - assuming it works the same way with woman as with men)
>Yikes. Plus, my understanding is that > 10 means no minimum security camp and > 20 means no low security, so she would start off in medium security. - assuming it works the same way with woman as with men)
I'm curious where you got that understanding. Would you mind sharing?
Especially since that could put the khibosh on my retirement plans (commit a serious, but non-violent federal crime and receive a lengthy -- hopefully the rest of my life -- sentence at a minimum security "Club Fed"[0] facility).
Free housing, food, health care and clothes with no tax liability for the rest of my life? It makes me want to to massively defraud some congress-critters once I turn 70 or so.
Assuming I could be assured of conviction, I'd even hold on to the stolen money so it could be returned to the victims.
Yes, I'm being somewhat facetious. But decent assisted living facilities run from USD6-12k/month and once I've spent all my money, it's off to a Medicaid facility that isn't much better than minimum security prisons anyway.
This way, I can give my money to those I care about and not have to worry about spending down my life savings to ~USD2,000 in order to qualify for crappy accommodations at a facility that accepts Medicaid patients.
Elderly are one of the most reliable voting blocs, whereas I’d argue most folks looking at long federal sentences are likely already convicted of at least one felony charge, thus stripping them of their rights to vote in nearly all states, at least while incarcerated.
If war is politics by other means, I suppose a prison riot is democracy by other means.
A better alternative to a retirement home is to retire to a cruise ship. It’s actually a lot more affordable than many retirement homes and far more luxurious, entertaining, and with way better food. You also get the benefit of being able to take day trips in various ports of call and of course you get full housekeeping services like any other cruise passenger.
Is that how it works? I’d hope you’re wrong, but have no reason to think so, because I’d like to believe that the kind of prison you’re sent to is related to how much of a risk you are to others. I’m not remotely an Elizabeth Holmes fan, but she isn’t going to be beating people up in the prison yard.
> I’d hope you’re wrong, but have no reason to think so, because I’d like to believe that the kind of prison you’re sent to is related to how much of a risk you are to others.
I think in theory escape risk is a part of it, too, and people with extremely long sentences are presumed to have rather more motivation to escape.
I guess that makes sense, although on a personal level, I’d rather serve time in a minimum security prison and get it over with than escape, inevitably get caught, and have additional time in a worse place.
I don't know, in principal I'd rather go and live in south america on a modest income (assuming you have carefully sequestered some investments) for the rest of my life than spend 20+ in prison which is effectively the rest of my life anyway.
Do you mean 'how crudely and unintelligently you harm others'? It sounds like you're setting up a framework where you get sent to the mean prison if you're physically bullying people, and the more intelligently you deliver your harm the better treatment you get, perhaps up to a point where if you're smart enough you can harm people on an enormous scale and get, I don't know, praise for it instead of prison.
Elizabeth seems the sort of person most capable of executing a plan whereby she pulls off a prison break through enlisting the aid of a bunch of other prisoners who're promised freedom themselves, but in her plan are actually there as decoys to be killed. It seems analogous to stuff she's already happily done. She is potentially a risk even to other prisoners if she carries on as she has done. I don't buy that she's not a risk to others.
Well, that’s certainly one way to interpret it. Another way is that the point of prison is to separate someone from society, not to put them in physical harm. If an accountant embezzles from his employer, he should do time, but maybe surrounded by other accountants and not armed robbers.
I’m not talking about just Holmes here, but about prisons in general. It’s not supposed to be fun, but neither is it meant to support a collective revenge fantasy.
I hate Holmes as much as anyone [0], but life in prison (65 years when you're 37 = out when you're 102) sounds unreasonably harsh.
She's not convicted of actually, physically harming anyone, esp. patients (which doesn't mean she didn't -- but she wasn't found guilty of that); she's convicted of lying to investors.
That's obviously bad, and should carry some form of punishment. Maybe 5 years? But life?? That's insane.
[0] I read John Carreyrou's book when it came out.
Personally, I find it desirable that people who commit massive fraud in the health care sector get punished severely (based on whatever charges they are actually convicted of), because chances are someone will actually be physically harmed even if that is hard to prove to a standard necessary for conviction (even if no actual harmful treatment resulted, which seems likely in this case, the misallocation of resources to the fraud means someone will likely be deprived of a treatment they would otherwise have received). So IMO 5 years would be insane -- Madoff got done for 10 years, and his fraud was much more benign (I suspect a very significant percentage of his victims knew the returns were to good to be true and that someone was being defrauded; they just didn't realize it was them).
Your argument is applicable to all white-collar crime. And it's emotionally-based, because she looks like one of us, not like a stereotypical thug. But in fact, she lied to take money from investors - theft on a grand scale - even if she wasn't wielding a sawn-off shotgun and wearing a ski mask.
Edit: aside from that, I agree the potential sentence is very long, but that is characteristic of the US justice system, right across the board. In my country, the maximum sentence is 25 years, regardless of the crime.
On the other side, one might make the argument that someone with millions of dollars to spare on early-stage investments should also be able to do their own due diligence on investments - otherwise, why would the status "accredited investor" be required? And, implicitly, that people like Holmes and Madoff who decide to exploit greed and unprofessionalism serve a vital purpose in a free market by acting as predators removing weak elements from the market.
Experts have warned from the beginning that Theranos made unrealistic to impossible announcements. Anyone investing at that scale without consulting experts IMO does not deserve protection from the law.
If Theranos is one thing, it is a real life example of why group dynamics and investing don't mix, and why the best thing to come out of r/wallstreetbets is the saying "do your own DD".
I think that argument gets lost when the company actively lies. In Theranos’ case, they forged letters by Pfizer claiming the system was validated. If a company is forging, say accounting books, it’s hard to claim due diligence would have prevented being swindled.
> In Theranos’ case, they forged letters by Pfizer claiming the system was validated.
Wirecard did the same with accounting statements from the Philippines, and EY accepted them without verifying that the statements are correct at the bank offices, they didn't even cross check if the billions of dollars could even be on the books of the Philippine banking system, and now EY is in hot waters.
If I were an investor and were presented with claims of validation of a technology that is hotly contested, the very first thing I'd do is call up or otherwise contact the issuer and verify the authenticity of that claim. It's like ten minutes to find out the contact information of Pfizer's Investor Relations team and compose a letter - investors who are unwilling to commit at least this little bit of verification deserve to be relieved of their money and office.
You bring up good points (although I think I disagree with your conclusion that people ‘deserve’ to be defrauded). There seems to be active collusion at times between oversight and the companies being audited. This isn’t the first time EY has been accused of this and we see it with credit ratings agencies too.
I think I come to a different conclusion because we all outsource our quality assurance on a daily basis. Did you review the airworthiness certificate of the last plane you flew on? If not, do you “deserve” to crash because you outsourced to the FAA without verifying it yourself?
I’d say the blame should fall to the third party auditors who failed the system, not necessarily to those who trusted them.
> Did you review the airworthiness certificate of the last plane you flew on? If not, do you “deserve” to crash because you outsourced to the FAA without verifying it yourself?
Am I a normal airline passenger/pilot or did I sign up as a test pilot for experimental / new / freshly repaired aircraft?
The latter get higher pay simply because that risk is part of their job, and to my knowledge test pilots have the option to refuse jobs they deem to be too dangerous. Same is for investors, with the difference that human lives can irrevocably be lost whereas money is only a virtual thing.
I don't think that's a good analogy to illustrate the risk profiles. You are incurring a risk by getting on a plane, but you have generally assumed that risk is mitigated by a third party verification process (namely, certification by the FAA in the U.S.). Likewise, an investor relies on third parties (auditors, SEC, etc.) to mitigate risk. Test pilots, by definition, are flying non-certified airframes meaning they are paid to take on the additional risk not mitigated by a third party verification process. This is why many investors will abstain from investing in companies from countries with weak third party certification processes.
The system breaks down when the third party is corrupted or incompetent in terms mitigating that risk. If we're going to say investors/airline passengers 'deserve' an outcome regardless of the role of a third party verifier, I'd probably say there's no reason for an SEC, FAA, audits, or even journalists for that matter. We've largely said as a society those organizations play an important oversight role in mitigating risk.
Your everyday normal "retail" investor should be protected by the law and regulatory agencies, e.g. requirement that companies offered to trade their stocks for unqualified investors need to follow SEC guidelines on accounting and business best practices, that insider and politicians' deals are regulated/reported, that environmental, consumer protection and labor laws are followed and that such companies are audited for compliance. For investment vehicles (e.g. funds, stock options that are not part of "employee stock" programs), that the risk of major or complete loss is limited (=investments done by these with the assets of normal investors should follow the same rules, and that investments into assets requiring accreditation do not exceed 20% of the assets under management of the investment vehicle). Obviously, that also limits the return of investment aka the pricing of risk.
Accredited investors / investment vehicles allowed to invest in high-risk assets however? The accreditation should represent an exchange: you get the potential to higher return of investment unlocked, but as a price for that you have to:
1. prove you can stomach significant losses (=you have to own your residence and can only invest 80% of your net worth into investments requiring accreditation)
2. spread investments so that no single or related (e.g. by majority ownership) high-risk investment exceeds more than 20% of your total portfolio. Exceptions can be made for holding companies, SPACs and similar investment vehicles, provided that their investors follow the same exposure limit.
3. prove you/your staff are actually qualified to make qualified decisions: professional education (e.g. a university degree in economics, finance and related subjects or training provided as part of employment at a bank or other financial institution) and the time to adequately review the companies you invest (=someone who works 60 hours a week in a non-finance related job should not be assumed to have enough free time and mental capacity to review and follow-up documents)
4. waive your right to protection by regulatory agencies and the judicial system to a degree that reasonably expectable efforts (such as calling up certification issuers to verify authenticity of a certificate) have to be undertaken.
5. agree to be held fully liable for your loss and the loss of your clients if you violate the rules or act negligently.
That way, the assets of the majority of the population are protected against loss of their investments, actual professionals now have a monetary incentive to responsibly invest their assets, and auditors have the incentive to actually do their job (and if they do not do that on their own, their liability insurance will make them do!).
A case could also be made for an intermediate class of investor to allow people not meeting the criteria to invest a limited portion of their assets (e.g. cap at 20% of net worth excluding primary residence, require a minimum net worth of 200k $) into high-risk investment.
We do the same with other high-stakes jobs (doctors, pilots) and organizations (see e.g. how cyber-security insurances force companies to introduce IT security measures as part of providing insurance coverage) - why don't we do the same with the finance industry? There have been more than enough high-profile cases now, some of which actually caused global crisis events.
ETA: Additionally, "margin trading" should be banned or at least strictly regulated for all investors. The amounts one can see in the "Loss Porn" section of r/wallstreetbets are simply inconceivable. No one should be able to YOLO their retirement funds into Gamestop ffs, and no one should feel forced to off themselves because their bank showed them a 730k US-$ margin call [1].
This clarifies your position well and I largely agree. It wasn’t immediately apparent from your earlier post that you were talking about the specific case of accredited investors.
Regarding the margin call type investments, I would add it’s not to just prevent endangering oneself but protects society as a whole. As a layman looking at past economic bubbles, it seems the one corollary is excessive speculation coupled with excessive leverage.
The key thing with regulating margin trade is that most home loans have less equity requirements than margin trading accounts - you can get homes with zero equity sans closing costs these days, while you have to maintain at least 25% equity in a margin trading account, and people don't have much of an issue with either.
As long as the economy, the financial, employment and housing markets behave somewhat reasonable, even extreme leverage is not a problem... but in sudden uncontrolled crashes, that amount of collective leverage explodes backwards and everyone has a problem.
I'm actually not sure if it is possible to regulate margin at all to a resilience degree that stands up to market depressions, given that debt and leverage are essential to the working of any economic system (including all the various forms of socialism!) in a scarcity-based world itself.
For the most part, it wasn’t really possible to perform due diligence in this case, because Theranos refused to submit to an audit, and otherwise lied and actively prevented investors from getting the true story. For that reason, some potential investors walked away.
She straight up said she was backed by partnerships with big pharma and that the device was working. I would have invested in a heart beat given the claimm. Lying at that level is insane. She need removed from the presence of law abiding citizens as long as possible.
I've been involved in investment due diligence investigations. You don't just take people's word for that sort of stuff. You literally pry through everything and confirm it for sure.
Not to defend her actions, but why do Americans particularly insist on severe, inhumane, and disproportional punishment? It would be completely unthinkable for her to get anything >15 years in Germany, likely much much less than that (let'ss ee how Wirecard goes). She didn't murder or harm anyone. She committed fraud.
As if sending her to prison for 5-10 years wouldn't be enough? Who will give her money or believe anything she does afterwards? She's done for no matter what. 65+ years is just to be cruel and enjoyment of the cruelty.
Even if it is the health sector where harm can easily be done, punishments shouldn't be based on hypotheticals.
Personally, I think she should get 12 years. That’s a long time.
I’m an American. As a society, we believe in the deterrent value of punishment (which is proven not to work). We also see prison as a place to put dangerous people in order to protect society. We see only the risk of letting dangerous people out of prison, not any potential benefit. If we have to lock up 1 innocent person to be sure that 9 dangerous people gets locked up, those numbers work for us. It’s a kind of tunnel vision focused on the worst offenders and ignoring the many non-violent or rehabilitated offenders.
So, it’s just this very one-sided view, very risk averse and without much empathy or grace toward the offender.
Also, I think we tend to minimize how hard it is to serve time in a cage. And when people come out of prison and commit further crimes, we assume they didn’t spend enough time behind bars. It’s the one and only solution to the problem. If it’s not working, we apparently just need more of it.
It doesn't seem to have worked for Elizabeth Holmes or Bernie Madoff.
According to this fact sheet, "the certainty of being caught is a vastly more powerful deterrent than punishment". Elizabeth Holmes and Bernie Madoff probably didn't think they would be caught.
> It doesn't seem to have worked for Elizabeth Holmes or Bernie Madoff.
Penalizing mass murder also doesn't seem to have worked to prevent 9/11. The question is how representative the perpetrators are in these cases. I'd say not very -- do you disagree?
> According to this fact sheet, "the certainty of being caught is a vastly more powerful deterrent than punishment".
Just because you read it in some fact sheet doesn't mean it's true or even makes any sense. Probabilities and punishments are not commensurable so what does this even mean (without some attempt to describe a subjective loss function)?
Taken literally it's obviously untrue. Examples abound where people don't care much about being caught because the punishment close to non-existent or very light in comparison to the rewards. This is why why gangs like to groom minors, the likely reason why San Francisco has a shoplifting problem, or to bring it back to white-collar crime, why certain types of corporate and individual malfeasance occur over and over again, because the risks, even when caught, are minor but the rewards are not.
Your original claim is tantamount to saying that people don't react to incentives. Which beggars belief. That is not to say that criminals in particular respond to incentives in a way that maximizes their life outcomes or is intuitively obvious, or that for many crimes lowering penalties and investing in other things instead (like detection or prevention) wouldn't produce better societal results. But on the whole I'd expect high-flying financial criminals to respond to incentives set by justice system in a way that is more aligned with their actual utility function than say crack addicts committing robberies to finance their next fix.
What Elizabeth Holmes tried to do is possible. So we can be a bit kinder than that: she thought with enough help she’d figure it out and make her lies the truth before being found out.
She didn’t of course, but it wasn’t impossible to do. She just wasn’t good enough.
After all most cells in your body do a few thousand blood tests on millilitres of blood every second. Our technology has a long way to go but it can be done.
Misdiagnosing people is not harmless. Compare it to selling snake-oil cures, that prevent folks from getting actual medical help. It could kill people. Not harmless, done at a huge scale, and probably killed people or shortened their lives.
> why do Americans particularly insist on severe, inhumane, and disproportional punishment?
Part of the reason is because punishment is so wildly variable and also sentences are almost always shortened drastically. It never looks like justice prevails. A "20 year sentence" is never actually "20 years", it could easily end up being a few years + probation, or even less.
Not sure why you replied to me, I was objecting to the parent comment’s casual endorsement of a racist archetype.
Also, america sure as shit better not go light on a rich lady who sold profit dreams to old men while giving outrageous sentences to poor people everyday. You want to talk about criminal Justice reform she is definitely last on the list of people who deserve leniency.
5 years?! People can get that much for stealing a car or jewelry. She stole tens of millions! Not only that, she did it through fraud. It’s not like you can just build a higher fence. For the system to work, it must be free of fraud.
Fraud is different from theft. Fraud is manipulating consent. Theft is taking by force what isn't yours. I don't know why everyone seems to be conflating the two everywhere in this thread.
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.
The question is not just the state of the victim, it is (mainly) the intent of the perpetrator and the means used. That's why you don't get the same sentence if you harm somebody by accident or if you meant to do it.
The sentiment that sentencing is justified by retribution is the number one reason why the US criminal justice system is messed up. The concept of right-and-wrong and mens rea are inextricably one.
Intent. Both fraud and theft require intent, rear ending a car can happen regardless of intent, and would be a much more severe charge if there was intent.
> Grand theft includes theft of property with a value of more than $950 or theft of a firearm (any value). The penalty for stealing a firearm is a felony, punishable by a state prison term of 16 months, two years, or three years. In all other cases, grand theft is a wobbler and can be charged as a misdemeanor or felony. A misdemeanor sentence results in up to one year in jail and a felony sentence results in prison time of 16 months, two years, or three years. (Cal. Penal Code §§ 487, 490.2 (2020).)
You actually can't get that much time for stealing a car or jewelry. What gives a criminal that much time is that "theft" is often actually "robbery", which involves the use of coercive violence. Violence is generally punished much more harshly.
> California Penal Code 211 PC defines the crime of robbery as “the felonious taking of personal property in the possession of another, from his person or immediate presence, and against his will, accomplished by means of force or fear.” Robbery is a felony punishable by up to 9 years in state prison.
> First-degree robbery includes robbery of
> any driver or passenger on a bus, taxi, streetcar, subway, cable car, etc.,
any person in an inhabited structure, or
any person who has just used an ATM and is still in the vicinity of the ATM.4
> First-degree robbery leads to a California state prison sentence of between three (3) and nine (9) years.5
It's not pedantry. Those people who got "much more time" aren't there for taking money, they're there for pointing guns and knives at people. Threatening to take someone's life is much worse than actually taking some money.
Just on your last sentence: The ideal amount of fraud is not zero, the cost of checking everything is too high. I recommend the book “lying for money” which breaks down what fraud is and what that tells us about the overall system
I think that there are two components in your argument, the personal harm element and social policing. The question for me is what responsibility and therefore forefit there should be on an individual for the social element. Interestingly it seems to me that the more libertarian folks are the harsher their view of punitive measures for social enforcement seems.
Sometimes it's not all just about the monetary amount. Someone choosing to use the threat of violence or death on a single individual one time to even take as little as $20 doesn't belong in a society.
Even if you're lying to trick some companies and investors to give you millions you're still not as evil or dangerous to society as the person who chooses to terrorize individuals for their gain. The actions are what matters.
“Do you understand what I'm saying?" shouted Moist. "You can't just go around killing people!"
"Why Not? You Do." The golem lowered his arm.
"What?" snapped Moist. "I do not! Who told you that?"
"I Worked It Out. You Have Killed Two Point Three Three Eight People," said the golem calmly.
"I have never laid a finger on anyone in my life, Mr Pump. I may be–– all the things you know I am, but I am not a killer! I have never so much as drawn a sword!"
"No, You Have Not. But You Have Stolen, Embezzled, Defrauded And Swindled Without Discrimination, Mr Lipvig. You Have Ruined Businesses And Destroyed Jobs. When Banks Fail, It Is Seldom Bankers Who Starve. Your Actions Have Taken Money From Those Who Had Little Enough To Begin With. In A Myriad Small Ways You Have Hastened The Deaths Of Many. You Do Not Know Them. You Did Not See Them Bleed. But You Snatched Bread From Their Mouths And Tore Clothes From Their Backs. For Sport, Mr Lipvig. For Sport. For The Joy Of The Game.”
- Going Postal, Terry Prachett
Fraud is not a zero-victim crime and less than petty theft is. Just because the investors can 'afford' it, their losses are passed on to society eventually.
The reverse, that you are in effect advocating, amounts to letting the big fish get away with fleecing LOTS of people while coming down much harder on the small fry that robs one person at a time.
Right, and it wasn’t cruel at all for her to put out medical devices she knew could and did produce false results for patients - in one case a false positive for HIV - solely for her own gain?
I think this is an interesting perspective because there have to be some unconscious biases at play to see these things so differently, even down to one person 'tricking some investors' and the other 'terrorizing individuals for their gain'. Furthermore, one of these people is 'more evil' and 'more dangerous'. In my own mind there's an element of classism involved because of how we see these two kinds of people so differently, and how we imagine them to live their lives.
In that sense, this CEO could be like the Sackler family - responsible for so much suffering across American society for the past decade or so, but because the scale is so large they've effectively abstracted themselves away from the evil and terror they are responsible for. The implication being that the opioid addict gets the full judgment of the law and society for terrorizing individuals to feed their addition, but the people who made the addiction possible get away with being tricksters. The only reason Elizabeth Holmes doesn't approach that level is because she and her startup got caught before they could release their fake products at scale, before the more serious consequences would begin.
If you ask me, I'd prefer to see both being held appropriately accountable, preferably in a way that encourages rehabilitation and not retribution or cruelty.
Above all, I think, because it's so diluted across a lot of people. To me, all these fraud-on-a-grand-scale-apologists are as naïve as Moist von Lipwig in the Pratchett quote in a sibling comment.
The jury acquitted her of 4 counts regarding defrauding patients. She may have caused them civil harm, but that’s a different case than what was being considered here.
She effectively stole millions. That's multiple lifetimes worth of work for a lot of people.
If you assume average salary of 100k per year per person with 1/4th of time work per year. that's effectively 400k per year per person. He stole a hundred million which would be 250 years.
From people who could easily afford to lose it and who should have known better. None of the people she defrauded have a materially worse quality of life than they did before.
Her biggest crime was making rich people look stupid, and they REALLY don't like that.
In the book Bad Blood, people wanted to come out to expose Theranos and she had the most expensive law firm in CA basically threaden to sue people into oblivion. The person who spoke to the WSJ journalist who broke the story and put his name on the record did so because his dad mortgaged their house to deal with legal implications. Before that there were patients, doctors, employees etc. bullied by the company into submission.
Really? What about the literal stalking by her legal team? Two people directly involved in the company were suicidal due to the environment she created, one of whom did end up committing suicide.
Apparently not a serious crime it would seem, since no prosecutor seems to care. It is very clear that in the current court system defrauding rich people is a much worse crime that 'accidentally' killing a few poor people. Had she gotten drunk and killed someone with her car, she would be looking at a much lighter sentence.
This is the inverse of implying the people Kyle Rittenhouse deserved to die because of their criminal history.
It does not matter at all that they could afford to lose it. Her biggest crime was the one she just got convicted of, being a fraud and lying for profit.
One side of this conversation is unnecessarily harsh, I get that, but the other side of this conversation is playing mental gymnastics to try and downplay what she did. Both are wrong.
> The crime she was convicted of isn't a crime you should spend effectively the rest of your life in jail for. It's as simple as that.
Not if you're a young(-ish) and relatively good-looking female billionaire CEO, at least.
Apparently, judging from the fact that I haven't seen all you people spouting this line on the barricades fighting for more lenient sentences for ordinary lowlife ugly middle-aged male fraudsters.
If it matters how rich the investors she defrauded actually are, perhaps she should get just a few months in jail:
"Notably, Theranos’ investors weren’t the usual-suspect venture capital firms. Rather, her funding came from individuals like former Secretary of Education Betsy DeVos, billionaire media mogul Rupert Murdoch, former Secretary of State Henry Kissinger and the Walton family, among other wealthy elites. Some evidence showed that these investors were willing to give Theranos money even when Holmes evaded their more probing questions."
> her funding came from individuals like former Secretary of Education Betsy DeVos, billionaire media mogul Rupert Murdoch, former Secretary of State Henry Kissinger and the Walton family, among other wealthy elites.
And there we have the crux of why she was prosecuted...
You're much better off screwing average people, then it's just "capitalism".
You don't understand. In our system of capitalism, fleecing investors under false pretenses is the gravest of sins. She must be punished accordingly, in order to make a legal statement to other potential capital thieves.
And to note, these are federal charges so there’s no parole. When you get 20 years in federal time, you may get some time off for good behavior but you’re going to serve most of your sentence.
Don't discount the possibility that she'll have her sentence commuted by a future President. Look at the roster of political heavyweights that she was able to attract to the company. It wouldn't surprise me if one or more of these people still have an affinity for her and, at the right time, throw some good words in the President's ears on her behalf.
I suspect that was peak Ridiculous President Behaviour, tbh. Any future president that venal will take care to hide it a _little_ better.
And I think that was a little different; in that highly polarized environment it was possibly a little easier to sell corrupt pardons if they were of people on the president's 'team'; at least some of his supporters would put up with it on that basis. Holmes wouldn't qualify; she's just a generic wealthy criminal.
This disgusts me. The president should not have the power to free anyone from prison. If the laws are broken then (attempt
to) change those, but otherwise you’re just saying “yeah, you’re guilty, but I like you so you don’t need to serve your time like everyone else”.
I believe it was originally designed to be a safety valve in the system. A person can be found guilty because the laws are blind, but if a (loud) majority of the population thinks it was a misjustice, the president can fix the situation.
I don't think any of the founding fathers foresaw presidents using their power to pardon their friends. The whole system is extremely vulnerable to an insider attack - very few tools are in place to work around corrupt leaders.
Well, realistically, it was just copied off powers that the British monarch had at the time. Lots of the oddities of the US presidential institution can be traced back to that.
Interestingly, this pattern repeats itself; countries which became independent from Britain later on often have a far less powerful president, with similar powers to when _they_ left. The president of Ireland, for instance, is non-executive, doesn't have a veto, and can't commute sentences... much like the British monarch when Ireland became independent.
As it stands, it's an anachronism that only survives because it's _really_ difficult to change the US constitution, I suspect.
That was only one of the reasons given in the Federalist Papers for its inclusion; the other is the need to be able to throw around pardons as a bargaining chip in quelling rebellions and civil disorders. The post-Civil-War pardons are a classic example - getting people off the hook for death-penalty treason stuff in order to keep them from going into a new rebellion in a few years - as are the post-Vietnam blanket pardons for draft dodgers.
It's a power Kings have. "The Royal Prerogative of Mercy". That's why the President has it, there weren't a lot of other examples for the Executive to be modelled on. However of course in modern constitutional monarchies the King doesn't operate this power any more, for example Liz's pardon power is operated by her government and ordinarily via some dusty committee looking into injustices (the government occasionally has used it directly e.g. some guy years into his life sentence for murder tackled a terrorist who was stabbing people at an event in London, the Pardon power was used to reduce his sentence in recognition of this bravery)
The US President should have handed this power over to a similarly dusty committee resolving real injustice years ago. This would be less corrupting and more effective because a President is busy whereas the committee would be doing nothing else except investigating the circumstances of potential injustice and choosing how to resolve them (new trial, pardon, etc.)
IIRC the President only has the power to pardon Federal crimes, not "anyone".
As for Ms. Holmes, she defrauded very rich and powerful people. I would be surprised if she were shown any leniency at all, never mind a Presidential pardon.
I guess I understand the cynicism but her net worth appears to be not much. Usually you'd want to use your money to avoid getting convicted but here we are.
It's non-violent. Nobody died. I think 5-10 years. Maybe she can be Shkreli's pen pal.
Wasn't it mostly vapor ware medical testing services? Afaik they mainly wasted investor time and money and took customer money for test services they just never ended up providing. Unless I'm missing something??
I think their customers just ended up stuck with the bill and had to go to a regular lab.
Holmes is not particularly attractive. Martha Stewart was (accounting for age) attractive and somewhat beloved in the US and served time. I don't think Holmes really has anyone in her corner when it comes to a 'beauty pass'.
Non American here, why do people use this infantile term to refer to a spouse? Unless I am mistaken, the father of her child is her husband - why use another term?
Edit: Thanks everyone for pointing out that you don't need to be married to have a child, wow, everyday a school day on HN.
But her husband _is_ as far as we know, the father of her child.
she is not currently jailed. i saw on the news this morning after her guilty verdict walking out with her lawyer. i don't believe they jail you until sentencing for white collar crimes since you aren't a "threat" to the general public
And words towards 'won't she be in jail through any appeal process.'
But in response to the original comment saying she won't get jail time at all due to appeals, do you think she will not be sentenced and the appeal with happen before then where they disregard this conviction during that process?
Anyway, confusion aside I was trying to politely point out they seem wrong in their assumption she will never see jail due to an appeal process. That's not how the process works.
You slightly misunderstood my cynicism: I don't think they'll overturn this convinction and cancel her sentence.
I think she'll only start serving time once the very last round of appeals ends - which is going to be many years after her death. They'll just Jarndyce v Jarndyce for decades to come.
Based on a very quick reading, I think the most serious offense (the $100M one) would at least land in the 97-121 months bucket. If she serves half of that, best case for her is 4 years. Not too bad.
Unlike many state systems, in the federal system the sentence is close to the actual time you’ll serve, short of a Presidential commutation or some other special intervention. Other than up to 54 days/year good conduct time, there's not systematic early release.
"Hopefully she'll get more, SV could use a good example."
I knows Theranos was headquartered in Palo Alto for part of its life, but is it really a SV company? Looking at their board I see mostly old-school business people from a construction company, Wells Fargo, and James Mattis and a former head of CDC. Only real tech person seems to be someone from NetApp. On the investor side, I don't see any of the big SV names either. Initial funding came from Rupert Murdoch.
I think there's some quibbling over what a SV company is.
Theranos was located in SV and Holmes referred to it as a SV style company, you might argue this is enough to make something a "Silicon Valley Company". I think OP would view such a company as one both in SV and embraced by the local ecosystem of developers and investors. I think SV "learning a lesson" from the downfall of a company only makes sense for the latter definition, and I don't think Theranos fits it.
In reading Bad Blood it becomes apparent that, Tim Draper aside, the SV investor community realized much earlier than anyone else that Theranos was shady and either pulled their money or stopped investing. As someone living here in the area at the time I felt it was common knowledge in dev circles that Theranos was shady and lying about their capabilities (though not to the level that was revealed). Certainly it did not seem to be a prestigious place to have on your resume.
Given that the SV ecosystem seemed to largely sniff out Theranos before the rest of the world it seems weird to expect them to learn a lesson from its downfall.
The answer to this depends a lot on whether you consider e.g. Arrillaga-Andreessen "SV" or not. Holmes certainly wanted Theranos, and herself, to be viewed and valuated as such.
Can you name another "wantrepeneur" that needed deterring by this case?
I don't follow startups that closely. The only example I can think of is Elon Musk's "full self driving" promises, but the gap between promise and reality is a lot smaller in that case. Even then, the claims are still mostly future timelines, not "it works now, no I can't show you, trust me!!"
Ok I'm not American so perhaps my perspective is different... More than 10 years would be utterly barbaric. The 65 years mentioned in another comment chain would be well beyond the pale.
I'm no fan of Holmes, but what good does it serve to lock up non violent criminals for decades?
> I'm no fan of Holmes, but what good does it serve to lock up non violent criminals for decades?
“non-violent” criminals can do much more widespread damage individually than violent criminals are likely to, but are also more likely to be rationally deterrable with a sufficient consequences (which anything you'd willing gamble against the potential upside of the massive crime is not.)
Basing severity on dollars stolen is flawed - it should based on the percentage of the victims assets stolen. Taking $1 million fraudulently from Warren Buffett is not the same as taking it from the average pensioner.
She took money of retail investors as well. There is a podcast called "the dropout" which has featured done pretty ordinary people that lost their savings. Ok, we can judge them, just like we will judge all the nft & crypto victims, but the suffering is real.
For many (though certainly not all) of the investors victimized by Holmes, I'm not terribly sympathetic. As implied by "qualified investor", if you write such a big check, it's sort of up to you to do the homework.
I do have some sympathy for people who got Theranos tests and were mislead about their efficacy, but on the charges of defrauding patients Holmes was found not guilty! (Similarly, I have some sympathy for employees who went to work at Theranos and ended up bullied and threatened by the company, as with Tyler Schultz, but they aren't represented by any of the criminal charges!)
The harshness of sentences has zero deterrence effect. This has been demonstrated many times. Also, if it had, then the US would be crime free, as it has the harshest system in the world.
The only thing that has a small deterrent effect is how likely a potential offender think they are of getting caught.
Have you studied this kind of crime specifically, and looked at specific sentencing terms, eg. 5 vs. 10 vs. 15 years? I'm guessing no, and more than likely there's no data available for this.
My understanding is that even in cases where deterrents are known to work poorly, there's still some effect. For example, with drug addicts, there are diminishing returns in as little as a couple days, but I think there was still SOME effect.
It just winds up being mostly pointless, because a weekend sentence works pretty much the same as eg. months to years or more. You should be careful about extrapolating from behavioral studies, and other crimes.
It's not just about deterrent IMO. I also care about justice, fairness, and making it not worth it to commit white collar crimes. If the sentence is not substantial, you've basically gotten away with it to me.
It's worth 1-5 years in prison to spend 5-10 years in luxury, being told how amazing you are. Maybe not for me, but it certainly is for a lot of people. A ton of white collar criminals end up better off for their crimes, if you're not harsh enough.
This might be overly handwavy of me, but I struggle to see a scenario where a rationale Elizabeth Holmes thinks the expected value of what she did is positive if the standard sentence is 10 years, but thinks it's negative if the sentence is 65 years.
Maybe the takeaway is that criminals (and humans) aren't entirely rational, and 65 years is just a great "headline" for deterrence. But framing this as about deterring rational criminals strikes me as then putting a high burden of proof on the argument for 65 vs 10.
> “non-violent” criminals can do much more widespread damage individually than violent criminals are likely to
How did you come to that conclusion? It seems like a difficult argument to support.
In terms of human life, probably not, right? I mean hypothetically the investors could have gone on to spend their money on lifesaving ventures and charities but that seems like a roll of the dice.
Not saying this is the case for Holmes', but scams can definitely destroy people's lives. It's not just about being financially ruined - which isn't a small thing - but also the feeling of guilt associated with having fallen for the trick.
Are we allowed to include executives who lie about the dangers of tobacco, asbestos, climate change, or politicians and bureaucrats who lie about the evidence they use to justify wars, things of that nature -- all lies for profit which materially damaged others -- in the non-violent bucket to answer your question?
They may not not technically be criminals because the government and judicial system protect this class of people, so in the interest of liability let's not allege they committed any crimes, but in the context of the the question yes white-collar or non-violent "whoopsie daisies" can do much more widespread damage.
It does, I guess, technically answer my question in isolation.
In the context of the broader discussion here, though I find it unsatisfying -- Holmes was specifically found guilty of defrauding the investors, and (as far as I've seen) acquitted of defrauding the patients. I don't think the main punishment for tobacco, etc company execs should be based around, hypothetically, ripping off investors (actually I guess their investors don't feel ripped off in many cases).
The main victims, in the case of tobacco and asbestos, seem to be people who've essentially been poisoned. This ought to be considered a violent act in my opinion. Unfortunately the legal system seems to see it differently, so again you are correct, but again I'm left a bit unsatisfied...
> what good does it serve to lock up non violent criminals for decades?
If you're stealing hundreds of millions of dollars, is anything less than a decade really a deterrent? Especially since sophisticated actors are the most likely to be deterred by long prison sentences.
Heck, does it really do any good to lock up someone who comes home to find his wife cheating and kills her and her lover for 20-plus years? I would contend that locking up the white-collar criminal does more good.
But I'll take on your specific example. Any crazy rich people out there, I will serve 5 years in a minimum security Western European prison for 143MM USD safely accruing interest in accounts for when I get out.
Here in school we learn that the chance to get actually caught is the primary deterrent and second the weight of the sentence in either monetary terms or time served.
Because people are bad at estimating low probability and high outcome expected values. If you are old you might even not deterred at all by a very long sentence if there is only a small chance that you actually both get caught and have to serve the time.
I think as a general rule, probability is more important to dissuade things like speeding or murder. I think advanced financial crimes and especially fraud have such an inherently low risk of getting caught quickly enough (after all, by definition they weren't caught by the sophisticated investors who have the most to lose) that we will have far more success by having heavy punishments.
I doubt she legally gets to keep all of it. In theory she probably cannot keep any, but if it's sufficiently hidden or already spent or given away it may be impossible to recover. The people she defrauded may accept recoverable cents on the dollar to get something back, and she may have access to more than she has to return.
Sorry to respond a second time, but another thought occurred to me. The frauds took place a while ago. Even if she had invested half in an index fund, she should still have 2x+ of the funds left. I don't know what if any interest is charged, but she might be able to repay the original investors at 110% and still make a tidy amount of cash, depending on what she did with the money.
Beyond stealing piles of money from investors, lying to people about medical treatments. Folks were making serious medical decisions with the results from their faked / half-assed tests.
We should destroy her life for cavalierly playing around with other people's lives in that manner. Theranos intentionally destroyed the database of test results, but their clear goal was to yolo out medical tests.
She should absolutely be put on trial for playing with people's medical diagnoses. But that's not the crime she's been found guilty of yet, right?
Hopefully screwing around with medical tests will have much more serious consequences than stealing money. Hopefully this was just the first step, and having her in jail will prevent her from tampering with the evidence for the more serious crimes. Hopefully we live in a society that values lives more than money...
Was she? I saw that she was acquitted of defrauding patients, but surely handing out known bad diagnoses also has some consequences from a 'risking lives' viewpoint, right?
Like if you order some bullets from a gun shop, and the guy delivers them by doing a drive-by on your house, surely the only legal problem for the deliveryman can't be "these bullets were a ripoff, the gunpowder is already expended!"
> I saw that she was acquitted of defrauding patients, but surely handing out known bad diagnoses also has some consequences from a 'risking lives' viewpoint, right?
The bad diagnostic test in exchange for money is the essence of the fraud she was acquitted of, not some separate harm.
I mean, it's not impossible she could face state law claims about it separate from the federal ones, but any federal criminal claims from the same set of actions would be foreclosed now by double jeopardy (besides retrial on the charges that the jury hung on.)
Agreed. Holmes is 37, so 65 years is a life sentence. From a European perspective, life sentences should be for people who are too dangerous to ever allow back into the community, or whose crimes are so monstrous society requires such retribution - terrorists, child killers, serial killers and so on. US sentencing appears very vindictive, not so much for trust-fund faildaughters but for people of colour arrested for minor drugs offences or under "three strikes" laws. Reminds me a lot of the "Bloody Code" of 18th century England.
You do realize actual patients got completely wrong results on their blood tests, thereby potentially jeopardizing their ongoing treatment for pretty serious conditions? How is it a "non-violet" crime when we're talking about potentially killing patients due to fraud?
I agree with you from a moral perspective, and think that's far more important than the financial aspect. But she was convicted of other crimes.
Perhaps the judge can factor that kind of thing into the sentencing; I'm not sure.
In an ideal world (not that we live in anything resembling a perfect world) it seems to me that the harm you're talking about would be remedied in separate criminal and/or civil trials. Certainly, unless I'm mistaken, the victims of the fraudulent tests could still file civil suits.
I'm not a lawyer, in case it wasn't blindingly clear.
Non-violent does not mean that she did not cause physical harm. People underwent invasive and unnecessary medical procedures as a direct result of Holmes‘ fraud.
The US generally has much longer prison terms than most of the rest of the world. Compared to sentences for crimes of different/lesser severity in the US, more than 10 years is completely sane and, indeed, fair.
If you have a problem with US sentencing culture, as a moral and a political issue you should probably not start with rich well-connected scammers.
It would be totally justified to cap it at 10 years in this case, provided she's forever banned from being an executive in any company. Not sure if it's compatible with US laws though.
The BBC said she faces upto 20 years, but predicts she will get a much lower sentence because she has no criminal history and she is a first time mother with a young child.
Google "federal sentence table". The "no criminal history" thing is directly expressed on the chart (she'll be sentenced from the first column); each cell in the table is a range of months, and the first-time mother thing might get her the lower end of that range. The crimes she's convicted of are so severely sentenced that it's hard to see her not getting double digit years.
With all the charges grouped, including the conspiracy charge, we'd be looking at an offense level around 35 --- 168 to 210 months.
Federal judges must calculate the guidelines and consider them when determining a sentence, but are not required to issue sentences within the guidelines. So I wouldn't be surprised if we saw a downward departure from the guidelines.
I'm not saying I agree there should be a downward departure (imo, her pregnancy came across as a "Pregnancy Of Convenience"), just that there could be.
A sentence of 10 years or longer seems excessive in my personal opinion as well, but I can't help thinking that the baby only entered the picture when she was already facing those criminal charges, so there might have been an element of calculation involved.
She has a demonstrated record of cold, amoral manipulation and calculation. Just my opinion, but I think the child is a clear effort to increase sympathy. I would like to be wrong, but I think the truth is more sad and horrifying than most decent people can or want to imagine.
Given her cold rationality, the timing of the child may be her lawyer's advice, to get her sentence reduced. No consideration for the actual baby, how it would be raised given the circumstances...
Never having a baby seems better than having a baby you won't be able to be a mother to for 10-20 years. It's not unlikely the kid would hate you when you get out of prison.
Ideal no, but she isn't going to be in prison 20 years, most likely not 10 either.
Kid will be raised by father and family, won't be poor, and it is unlikely kid will hate his mom.
you should expect leniency if you had a young child and it was a first time offense.
I would also expect leniency if you got the child after you were charged, even though that implies people could just get kids to look for leniency, there is the idea that once someone gets a child they calm down and become more cautious. Maybe not so important in cases of non-violent, monetary crime.
However as it is commonly thought in society, and backed up by science ( https://www.psychologicalscience.org/publications/observer/o... ), that women take on a more nurturing role for the children and the absence of a mother would be more traumatizing (statistically, in the case of my son he freaks out if I leave but doesn't care much about the mother), the father can expect less leniency than a woman.
Why should having a child give any sort of leniency? Actually the aim of harming that child should increase the penalty. I believe in equality, giving discounts on crimes because family just seems absolutely unquestionably evil and immoral.
If we really think of it, shouldn't single person get leniency because him being in jail doesn't hurt others. So that can be considered in thinking about planning of crime. As others clearly aimed to hurt their families and friends by getting in jail in first place.
Well, because she's a rich white woman. If she were a poor black woman, having children would probably result in worse treatment. Having children after being charged might get her child taken away; clearly someone who has a child while facing significant prison time would be an unfit mother.
“Acted an criminal act with aim to harm the child.” Don’t see anyone suing her for that one - as an evil human being, of course- except for online underdogs screaming “crusify her!”
Well, frankly sentences in the USA are barbaric. We also have the habit of handing down terms that are impossible to satisfy, eg. for probation. They'll take away your drivers license then tell you to appear in several locations around town to avoid jail (btw a driving infraction isn't always necessary, although even if they did commit a DUI, that doesn't change the practical side). You'll get charged money and taken to jail for being too poor. It's not uncommon to resort to crime to raise money to pay the state to avoid jail.
All that said, I would hope for at least 8-12 years, possibly more. I don't take that sentence lightly and consider it very harsh (I can't stand people from the USA that consider less than 5 years and "easy sentence"). 3 years is a serious sentence, and 8-12 is extremely harsh, for good reason. It's very important to me to call this like it is. There should be heavy handed punishment, because this is among our most serious crimes.
She blatantly lied multiple times about a medical product. She had a team of enforcers harass people who tried to talk. Across the board, it was a very extreme case. More importantly, with so much at stake, these type of white collar crimes are quite frankly worth committing if the sentence is less than 5 years (I'm not sure the exact number, but it's at least 5).
For a substantial portion of the population, having that kind of wealth and influence for a short time is worth it; in some cases, even if you die. So it might not deter everyone, but I do think the possibility of spending lots of time locked up, will stop a lot of gray area people.
I also think it is necessary for fairness. I care about making these crimes "not worth it". At a certain point, you're basically letting people keep their ill gotten gains. Getting to be king for a decade, then go away for a year or two is no punishment at all.
I don't think 10-20 years is necessarily inappropriate.
"More than 10 years would be utterly barbaric." False.
65 years in prison would be a fair sentence for her. Homeless people in America have been sentenced to over 15 years in prison for stealing $100. Holmes stole an order of magnitude more than that. The US justice system needs to send a clear message to the would-be fraudsters that there are indeed some very serious penalties for being a criminal in this society.
The jaded view on this would be that we should then serve justice from the bottom-up, rather than pretending to be reformative to let another privileged, white criminal get off easy while not fundamentally changing anything. I can't say I disagree too much with it either. There is no indication that widespread reform in the justice system is impending, or that starting here and now would have a cascading effect leading to a better, less vengeful system for everyone.
I'm claiming Holmes is a criminal that deserves to be sentenced to the full extent of the law for the crimes she has committed. The US needs to hold criminals accountable for their actions. Otherwise we will continue to have a society full of criminals who exploit the justice system's leniency. 65 years in prison is completely fair for everything she did. In my opinion anyone who believes otherwise either doesn't care about the damage she has caused or doesn't fully understand the damage she has caused.
>>Homeless people in American have been sentenced to over 15 years in prison for stealing $100
>
> Using an existing injustice in the US to defend another does not make it right.
While that is true, it is also true that the law must be fairly enforced on everyone. Having some people receive lighter sentences for similar-in-intent but larger-in-scale crimes is not fair enforcement.
The US is a jigsaw of different legal jurisdictions with varying laws, legal standards and sentencing practices. A crime in one state with a life sentence might not even be a crime in another. I know this is a federal case, but it seems unlikely the case of the homeless person was too.
That is heartbreaking, though I'm not sure the bank teller would feel that way after having a "gun" pointed at them while the man yelled "this is a stickup". Also, the perpetrator may have had prior convictions.
In general we prosecute violet offenses (including the threat of violence, even if the gun wasn't real) more seriously than nonviolent offenses. While 15 years seems excessive (as do most prison sentences in the US, IMO), there's a lot of important context missing in your statement. Hyperbole might not be the right word, but I'd call it "substantially misleading".
I am curious to know what direction it is that you think would be the appropriate direction my comment should be leading towards and also, I am curious to know which direction you think my comment is actually pointing towards with its "substantially misleading" content?
I get the vibe you are a white-collar criminal apologist, I could be wrong, but am I?
10 years for 145 million seems cheap. I believe in linear sentencing. The time in prison should linearly scale with amount of damages done. Stealing 1000 vs 100 should result in 10x sentence. Stealing million vs ten thousand an hundred x.
While I don’t share in the misanthropic sentiment of the OP, it’s difficult for me to not sit here and say well if you didn’t want to go to prison you shouldn’t have defrauded people and violated the law…
I don't think anyone here is saying she shouldn't be going to prison or that she should be going there for less than a decade. But spending 65 years in jail for _anything_ short of substantially heinous crimes should cause anyone to question the motivation behind the sentencing. I understand that the wire fraud is what's causing the time to stack up here, but a 65 year sentence would be ridiculous. I'm much more onboard with a 10-25 year sentence though, even if there's perjury involved.
Alternatively, there were retirement funds and real people whom she defrauded, some of which needed that money to live on and now do not have it. Strong punishments befit serious crimes. More than 140 million defrauded counts as serious. Maybe she shouldn't have broken the law?
Besides, she can likely get probation with good behavior after a decade or two of time served.
To me the justice system already failed. It supposed to protect small people, society, vulnerable entities. There are stories how Holmes test were indirect result of someone death because they rely on those.
Meanwhile the only real sticking crimes are the one she commit against Betsy Davos (dirty corrupted rabbit hole warning if you Google her name). Obviously Bets placed few phonecalls. It it wasn't some VIP, she would get away with that too because all investments comes with risk.
Come on. You make it sound like it was only Betsy Devos she defrauded. There’s a long list of other ultra-rich people, including Oracle guy Larry Ellison, Walton Family (Walmart owners), and Rupert Murdoch.
Not fair to frame her sentence as Betsy pulling strings, even when I’m no fan of that woman for obvious reasons.
> You make it sound like it was only Betsy Devos she defrauded
In fairness, Betsy was 16th in line for for the US Presidency when Holmes was being charged and everything set up. And were it not for COVID-19 she would have been in that position for the entire trial. I'm sure with that kind of political power she was pulling some strings for vengeance.
If you added those names to elicit more sympathy for the defrauded investors, you're not exactly succeeding so far. You could throw in Henry Kissinger as well, and I still wouldn't feel particularly sorry for them…
Yes, I understand, it was just that the list was not just populated with run-of-the-mill meh billionaires, these are some of the least popular (at least in certain circles) billionaires one could pick (Nighttime noise disturbances — destroying small businesses - facilitating genocide — they really cover a wide portfolio).
If Holmes had decided to reinvent herself as a Robin Hood figure, she might be feted in Jacobin by now.
I believe you're missing forest for the trees. Some other commenters in this thread actually gave better explanation but think practically about this.
The prosecutors are not stupid. They have to come up with charges that actually stick, otherwise they risk losing this case in a spectacular fashion. If they went with an angle "X is morally bankrupt and her actions caused some deaths", it would make so much harder to prove and get the jury to agree to it.
Does multiple counts served concurrently mean that the effective sentence is just the longest individual sentence?
Also: I'm seeing from various websites that the maximum time-left-to-serve for minimum security (federal prison camp) is 10 years, but nothing definitive - [1] is the most in-depth but only specifies this requirement for male prisoners, whereas other requirements are clearly distinguished between male and female.
> Does multiple counts served concurrently mean that the effective sentence is just the longest individual sentence?
Generally, yes.
If her sentence is high she might not classify as minimum security (prison camp) and might have to serve some years at a medium before being moved.
Remember, federal prison sentences are generally "85%" which means you can get 15% off your sentence for good behavior. Almost every prisoner will get the maximum 15%.
I didn't read the indictment. Are her offenses nonprobationable? Usually non-violent offenses are probationable for first-time offenders.
Yes, the guidelines are kind of explicit about this for basic economic crimes. Ken White's the lawyer, though, not me!
They're actually even more specific for fraud cases, beyond the general 2B1.1 basic economic crime rule of sentencing according to the most severe count; for fraud, you apparently sum up all the losses from all the counts, which has the net effect of bumping Holmes up 2 additional levels.
https://www.ussc.gov/sites/default/files/pdf/guidelines-manu...
They're long and mostly not relevant except for the sections pertaining to Holmes conduct.
Here's the indictment:
https://www.justice.gov/usao-ndca/page/file/1135066/download
Holmes was found guilty of one 18 USC 1349 charge, and 3 18 USC 1343 charges; the 1343's she was found guilty on were in amounts ranging from $100k to $100MM(!).
It should be possible to come up with a better guess than the New York Times' "20 years per count, but likely served concurrently".