Elizabeth Holmes, the disgraced entrepreneur convicted of defrauding investors in her failed blood test startup Theranos, reported to a federal prison in Texas on Tuesday to begin her 11-year, three-month sentence. sentence.
Ms. Holmes surrendered to FPC Bryan, a minimum-security prison camp for women located about 90 minutes from Houston. He got into a Ford Expedition wearing jeans, glasses and a sweater, and got out with some papers. As he entered the prison, a bystander watching from the street shouted his name.
FPC Bryan’s 655 inmates are required to work in the cafeteria or in a manufacturing facility, where pay starts at $1.15 an hour, according to the jail’s handbook. Before starting work at the factory, Ms. Holmes may take a test to assess his strengths in areas such as business, clerical, numerical, logical, mechanical and “social.” Inmates can also enroll in a “Lean Six Sigma” training program to learn about efficiency.
“We are trying to help our girls get factory jobs that focus on their strengths so they can develop more marketable skills,” the prison handbook says.
Ms. Holmes, 39, was found guilty last year of four counts of wire fraud and conspiracy for falsely claiming that Theranos’ blood tests could detect various diseases with just a few drops of blood. . He and his former business partner, Ramesh Balwani, must jointly pay $452 million in compensation to defrauded investors. Ms. appealed. Holmes in his case, although his requests to stay out of jail during the appeal were denied.
Founded by Ms. Holmes founded Theranos in 2003 after dropping out of Stanford University at the age of 19. The company raised $950 million in funding, making him a paper billionaire. Theranos collapsed in 2018. Ms. Holmes and Mr. Balwani was indicted that year.
The pair was tested separately. Mr. Balwani was convicted of 12 counts of fraud and is serving a nearly 13-year sentence in a federal prison in San Pedro, Calif. He also appealed his case.
The sentence of Ms. Holmes intended to send a message to others in Silicon Valley: There are consequences when ambitious startup founders adopt an attitude known as “fake it until you make it” — as ambitious entrepreneurs talk about when what their companies can do, even if the companies can’t do those things yet – it’s too far. Despite the tech industry’s long history of breaking the rules, as entrepreneurs invent new businesses and disrupt old ones, few have been jailed for lying.
Since his conviction, Ms. Holmes lives in a rented house in San Diego near the family of Billy Evans, who is the father of her two children. During her trial, held in San Jose, Calif., Ms. Holmes and Mr. Evans lives in a house on the grounds of Green Gables, a $135 million estate in the affluent town of Woodside.
Their two young children, William and Invicta, are able to conduct video calls with Ms. Holmes and visit him on weekends and federal holidays. Phone calls are limited to 15 minutes each, with a total of 300 minutes per month.
In FPC Bryan, Ms. Holmes, known for wearing black turtlenecks to imitate Steve Jobs while running Theranos, and, during his trial, sporting heels, sheath dresses and diaper bags, will wear prison-issued khaki pants and a shirt in pastel green, gray, or white with athletic shoes that must not exceed $100 in value.
He doesn’t have internet access but he can buy a radio ($31.75) or an MP3 player ($88.40) from the commissary. All music must be “obscure,” according to the prison handbook.
FPC Bryan offers recreational activities including music programs, “table games” and movies, according to its handbook. Arts and crafts are available, including beading, knitting, paper art, crochet and ceramics. A crochet needle costs $1.30 and yarn is $3.55 at FPC Bryan’s commissary, according to the handbook.
Inmates are allowed access to a “recreation yard pavilion” outside but must return to their dorms for head counts that occur five times every 24 hours.
It is against the rules to forge or falsify documents and conduct business. Ms. admitted. Holmes falsified pharmaceutical reports to solicit investors while testifying in his trial.
Other inmates at the prison camp include Jen Shah, a “Real Housewives of Salt Lake City” star who is serving a five-and-a-half-year sentence for wire fraud related to telemarketing. In a blog post from March about her early days in prison, Ms. Shah the difficulty of operating the telephone system, which uses account numbers, and noted that not many people are kind. Breakfast is instant oatmeal, an apple and a slice of wheat bread with jelly, he wrote.
Lea Fastow, a former executive at the collapsed energy company Enron, was jailed for tax fraud at FPC Bryan for 11 months in the mid-2000s. Jenna Ryan, a participant in the January 6 attack on the US Capitol, spent 60 days there. And Michelle Janavs, daughter of the Hot Pocket co-founder, served five months for her involvement in the “Operation Varsity Blues” college admissions scandal.
Three inmates escaped from FPC Bryan in 2017. One of them, Edith Lara, who was serving time for drug charges, has not been found, according to the Bureau of Prisons website.
Annie Mulligan contributed reporting from Bryan, Texas.
