8 ms·

It's called fraud, and she defrauded and embarrassed many of the people she is "connected" to. Despite your assertion to the contrary, many white people have g

It's called fraud, and she defrauded and embarrassed many of the people she is "connected" to. Despite your assertion to the contrary, many white people have gone to jail for fraud. I also don't think there is much behind-the-scenes lobbying happening on her behalf (in fact there may be some lobbying against her).

micaksica 10y ago
IANAL, but federal criminal procedure requires more than just a smell of fraud to convict someone in a federal court. A Federal prosecutor either needs a political bone to pick or a pretty easy to convict case to push for charges. Federal prosecutors have limited time and pick things that either grant them political expediency or they believe that they have enough evidence that the person they are going after is going to end up convicted with some certainty. The problem here is not that Theranos has failed or has misrepresented the product, it's that Holmes personally needs to have been found to directly misrepresent the company in a fraudulent fashion. Her and Theranos can likely be sued (as civil cases require "preponderance of evidence") but I highly doubt you can prove fraud beyond a reasonable doubt unless there is a much greater scandal that is unearthed during an investigation. And that's probably not going to happen. So let's talk about a federal investigation of Theranos, then: this is someone who has had James Mattis, the current prime candidate for Secretary of Defense, for help and sits on the board of Theranos [1]. She is connected to most of the political elite (Kissinger et al, all of the VC/finance world.) If anyone can put down an FBI investigation on her person, it would be someone this well connected to organizations that the FBI themselves lean upon in some way or another. This is Washington, and let's be real, favors are favors. Helping one of these guys somewhere in some way buys you favors, and you may be able to trade to get the investigation off of your back. Furthermore, what stands to be gained by all of those on this board in power by prosecuting Holmes? It would tarnish the reputation of potential cabinet members and all others in Washington that "believed in" Holmes and her ideas. The political PR nightmare for these guys isn't worth the trouble of being involved in this. It becomes scandal for them. They would best see the company fade into irrelevance, and begin setting up the message that this is just another failed entrepreneurial case, of people making a moonshot and missing it. Tell Holmes it's OK, give her a powerful position in some healthcare think tank, and be on your way. Also, what message does it stand to give the American public that have been sold on this visionary? The PR storm told people here is a white, female college dropout who hit the Forbes list and achieved the American dream. Do you really want to start a news cycle where Holmes is now being thrown in prison? Do you want that message, especially when so much of Washington is connected to it? That's emotionally heartbreaking to many. So there's no bone to pick, if anything negative political blowback, an uncertain ability to prove Holmes herself defrauded people, and enough political power to tell the FBI to look at someone else. This is why I say there's little to no hope of her going to prison for this. Holmes knows what she is doing on that front, even if her visions didn't fully materialize. She has played the PR game pretty well up until this point, shoved her chips all in on the moonshot, and failed to deliver the goods. Frankly, I think she has thought all this through and her bets are on what I've said above. The question is whether or not this line of thinking is incorrect. I am armchairing it, and her life is on the line. [1] http://www.fiercebiotech.com/medical-devices/theranos-asked-military-general-for-help-tamping-down-misinformation-from-dod http://www.fiercebiotech.com/medical-devices/theranos-asked-...
- rayiner 10y ago
  Federal prosecutors like cases that are easy or will win political points. There is no public outrage against unicorn biotech companies to cash in on, and it doesn't seem like there is a slam dunk fraud case either.
  - micaksica 10y ago
    > Federal prosecutors like cases that are easy or will win political points. This is a better way of saying what I stated in my first paragraph, and, really, a better way of saying my whole comment if you don't care to see the details of my conclusion.
    - asdfasdfa11112 10y ago
      I am appreciative of both the summary and the original comment. Please don't feel like your thunder was stolen -- your breakdown was fantastic and taught me quite a bit about a situation I was mostly unfamiliar with.
- downandout 10y ago
  If she told a potential investor that the machines work, and she knew they didn't, that's fraud.
ecorealist 10y ago
Yes, many white people have gone to prison, but it has taken enormous and egregious cases for that to happen. Usually, a brown or other disliked minority fall-person will go to jail and to quell public outrage. Consider the 2008 crisis, yes some white Americans went to jail, but the major (only?) prosecution at Goldman Sachs for example was https://fr.wikipedia.org/wiki/Fabrice_Tourre https://fr.wikipedia.org/wiki/Fabrice_Tourre Were his emails damning? Yes, but lets not pretend he was anything but the most low-level fall guy, conveniently with a heavy french accent -- Americans love to hate him. Also, Rajat Gupta and Raj Rajaratnam were certainly dirty, but their prosecution was the highest profile one post-2008 and it was more an insider trading case, not actually going after CDO fraud. No one at AIG-FP or Goldman Sachs got prosecuted, almost none got prosecuted anywhere. Flash Crash -- lets find a young Indian guy and blame it on him. http://www.independent.co.uk/news/business/news/the-flash-crash-trader-who-made-40m-from-his-bedroom-will-be-extradited-a7361706.html http://www.independent.co.uk/news/business/news/the-flash-cr... Nevermind that spoofing is a widespread industry practice in America... Prosecutors will go after easy cases AND those that quell public calls for blood. Holmes does not "look" criminal to the typical American, so I bet she walks away -- your average voter/citizen would not be happy if she goes to prison. My bet is a lower-level Chinese/Indian/Mexican(!) or some other minority goes to jail for this. They may well be guilty so I wont argue it is cooked-up or anything, but likely wont be the actual [white] person at the top.
- ecorealist 10y ago
  Also, instead of down-voting inconvenient facts presented with examples perhaps post counter-examples. Or just continue to live in a pretend-bubble i suppose.
- edblarney 10y ago
  "Consider the 2008 crisis, yes some white Americans went to jail, but the major (only?) " The 2008 crises was not built on outright fraud by most of the banks. They didn't commit any crimes for the most part. Individuals lied on their applications, bank managers overlooked it, VP of Mortgage Sales for banks didn't want to hear about underperforming loans, ratings agencies didn't want to due proper due dilligence, German and Japanese banks buying the crap were too lazy to do any due diligence ... and it came down. There was 'systematic, greed, stupidity and irresponsibility' across the board - home buyers included. It was not caused by some cabal of bankers specifically doing something illegal.
mimimimi 10y ago
Hahahahahaaaaaa. Yeah, sure. Except when they don't. Exhibit A: Trump University
duaneb 10y ago
Many people commit fraud. Who can tell how efficient our justice system is? If it happens, it happens silently.
saryant 10y ago
People are pointing to 08 as a reason to believe she won't be charged, but the better analogy here in Enron. Lay, Skilling and Fastow were all sentenced to prison.
- PhantomGremlin 10y ago
  I agree with the general statement but, to be pedantic, Kenny Boy died three months before he was to be sentenced. https://en.wikipedia.org/wiki/Kenneth_Lay https://en.wikipedia.org/wiki/Kenneth_Lay Other recent Caucasian white collar criminals include Bernie Ebbers, CEO of Worldcom (currently doing 25 years in Federal prison) and Dennis Kozlowski, CEO of Tyco (he was a guest of the NY State Dept of Corrections for about 9 years).
- curiousgal 10y ago
  Martha Stewart as well.
deepnotderp 10y ago
Everyone forgot wall street bailout? She'll get off chock free

micaksica 10y ago

IANAL, but federal criminal procedure requires more than just a smell of fraud to convict someone in a federal court. A Federal prosecutor either needs a political bone to pick or a pretty easy to convict case to push for charges. Federal prosecutors have limited time and pick things that either grant them political expediency or they believe that they have enough evidence that the person they are going after is going to end up convicted with some certainty. The problem here is not that Theranos has failed or has misrepresented the product, it's that Holmes personally needs to have been found to directly misrepresent the company in a fraudulent fashion. Her and Theranos can likely be sued (as civil cases require "preponderance of evidence") but I highly doubt you can prove fraud beyond a reasonable doubt unless there is a much greater scandal that is unearthed during an investigation. And that's probably not going to happen. So let's talk about a federal investigation of Theranos, then: this is someone who has had James Mattis, the current prime candidate for Secretary of Defense, for help and sits on the board of Theranos [1]. She is connected to most of the political elite (Kissinger et al, all of the VC/finance world.) If anyone can put down an FBI investigation on her person, it would be someone this well connected to organizations that the FBI themselves lean upon in some way or another. This is Washington, and let's be real, favors are favors. Helping one of these guys somewhere in some way buys you favors, and you may be able to trade to get the investigation off of your back. Furthermore, what stands to be gained by all of those on this board in power by prosecuting Holmes? It would tarnish the reputation of potential cabinet members and all others in Washington that "believed in" Holmes and her ideas. The political PR nightmare for these guys isn't worth the trouble of being involved in this. It becomes scandal for them. They would best see the company fade into irrelevance, and begin setting up the message that this is just another failed entrepreneurial case, of people making a moonshot and missing it. Tell Holmes it's OK, give her a powerful position in some healthcare think tank, and be on your way. Also, what message does it stand to give the American public that have been sold on this visionary? The PR storm told people here is a white, female college dropout who hit the Forbes list and achieved the American dream. Do you really want to start a news cycle where Holmes is now being thrown in prison? Do you want that message, especially when so much of Washington is connected to it? That's emotionally heartbreaking to many. So there's no bone to pick, if anything negative political blowback, an uncertain ability to prove Holmes herself defrauded people, and enough political power to tell the FBI to look at someone else. This is why I say there's little to no hope of her going to prison for this. Holmes knows what she is doing on that front, even if her visions didn't fully materialize. She has played the PR game pretty well up until this point, shoved her chips all in on the moonshot, and failed to deliver the goods. Frankly, I think she has thought all this through and her bets are on what I've said above. The question is whether or not this line of thinking is incorrect. I am armchairing it, and her life is on the line. [1] http://www.fiercebiotech.com/medical-devices/theranos-asked-military-general-for-help-tamping-down-misinformation-from-dod http://www.fiercebiotech.com/medical-devices/theranos-asked-...

rayiner 10y ago
Federal prosecutors like cases that are easy or will win political points. There is no public outrage against unicorn biotech companies to cash in on, and it doesn't seem like there is a slam dunk fraud case either.
- micaksica 10y ago
  > Federal prosecutors like cases that are easy or will win political points. This is a better way of saying what I stated in my first paragraph, and, really, a better way of saying my whole comment if you don't care to see the details of my conclusion.
  - asdfasdfa11112 10y ago
    I am appreciative of both the summary and the original comment. Please don't feel like your thunder was stolen -- your breakdown was fantastic and taught me quite a bit about a situation I was mostly unfamiliar with.
downandout 10y ago
If she told a potential investor that the machines work, and she knew they didn't, that's fraud.

ecorealist 10y ago

Yes, many white people have gone to prison, but it has taken enormous and egregious cases for that to happen. Usually, a brown or other disliked minority fall-person will go to jail and to quell public outrage. Consider the 2008 crisis, yes some white Americans went to jail, but the major (only?) prosecution at Goldman Sachs for example was https://fr.wikipedia.org/wiki/Fabrice_Tourre https://fr.wikipedia.org/wiki/Fabrice_Tourre Were his emails damning? Yes, but lets not pretend he was anything but the most low-level fall guy, conveniently with a heavy french accent -- Americans love to hate him. Also, Rajat Gupta and Raj Rajaratnam were certainly dirty, but their prosecution was the highest profile one post-2008 and it was more an insider trading case, not actually going after CDO fraud. No one at AIG-FP or Goldman Sachs got prosecuted, almost none got prosecuted anywhere. Flash Crash -- lets find a young Indian guy and blame it on him. http://www.independent.co.uk/news/business/news/the-flash-crash-trader-who-made-40m-from-his-bedroom-will-be-extradited-a7361706.html http://www.independent.co.uk/news/business/news/the-flash-cr... Nevermind that spoofing is a widespread industry practice in America... Prosecutors will go after easy cases AND those that quell public calls for blood. Holmes does not "look" criminal to the typical American, so I bet she walks away -- your average voter/citizen would not be happy if she goes to prison. My bet is a lower-level Chinese/Indian/Mexican(!) or some other minority goes to jail for this. They may well be guilty so I wont argue it is cooked-up or anything, but likely wont be the actual [white] person at the top.

ecorealist 10y ago
Also, instead of down-voting inconvenient facts presented with examples perhaps post counter-examples. Or just continue to live in a pretend-bubble i suppose.
edblarney 10y ago
"Consider the 2008 crisis, yes some white Americans went to jail, but the major (only?) " The 2008 crises was not built on outright fraud by most of the banks. They didn't commit any crimes for the most part. Individuals lied on their applications, bank managers overlooked it, VP of Mortgage Sales for banks didn't want to hear about underperforming loans, ratings agencies didn't want to due proper due dilligence, German and Japanese banks buying the crap were too lazy to do any due diligence ... and it came down. There was 'systematic, greed, stupidity and irresponsibility' across the board - home buyers included. It was not caused by some cabal of bankers specifically doing something illegal.

mimimimi 10y ago

Hahahahahaaaaaa. Yeah, sure. Except when they don't. Exhibit A: Trump University

duaneb 10y ago

Many people commit fraud. Who can tell how efficient our justice system is? If it happens, it happens silently.

saryant 10y ago

People are pointing to 08 as a reason to believe she won't be charged, but the better analogy here in Enron. Lay, Skilling and Fastow were all sentenced to prison.

PhantomGremlin 10y ago
I agree with the general statement but, to be pedantic, Kenny Boy died three months before he was to be sentenced. https://en.wikipedia.org/wiki/Kenneth_Lay https://en.wikipedia.org/wiki/Kenneth_Lay Other recent Caucasian white collar criminals include Bernie Ebbers, CEO of Worldcom (currently doing 25 years in Federal prison) and Dennis Kozlowski, CEO of Tyco (he was a guest of the NY State Dept of Corrections for about 9 years).
curiousgal 10y ago
Martha Stewart as well.

deepnotderp 10y ago

Everyone forgot wall street bailout? She'll get off chock free