Elizabeth Holmes Claims She Can't Afford To Repay Victims Of Theranos Fraud

Jailed Theranos CEO Elizabeth Holmes claims she won't be able to afford restitution payments of $250 a month to victims of her fraud when she's released from prison, Fortune reported. Notably, Ms. Holmes is jointly liable for the amount with Sunny Balwani, her ex-boyfriend and Theranos' former COO, who is serving nearly 13 years for his role in the fraud.

According to the BBC, the entrepreneur was sentenced to over 11 years in prison and also ordered to pay $ 452 million – $250 a month, with her former business partner Ramesh Sunny Balwani to dozens of high-profile investors they defrauded. 

The Justice Department lawyers last week proposed that Ms. Holmes pay $250 a month, or at least 10% of her income, once she's released from prison. Meanwhile, Mr. Balwani is required to pay $1,000 a month once he's out.

However, the disgraced entrepreneur's lawyers objected to the decision, citing Ms. Holmes' "limited financial resources."

"Mr. Balwani's amended judgment says nothing about what the Court intended for Ms. Holmes' restitution schedule. Ms. Holmes and Mr. Balwani have different financial resources and the Court has appropriately treated them differently," they wrote in a filing Monday, as per CBS News.

Ahead of her surrender, she told The New York Times that she ''can't'' pay her legal expenses, and would ''have to work for the rest of my life to try to pay for it.'' She has also claimed in court filings that she has "no assets" and no hope of restarting her career after the Theranos scandal.

Experts say that the victims might never get fully paid out.

Last month, she surrendered at the prison camp in Bryan, Texas, an all-female facility, to begin an 11-year and three-month sentence.

The Theranos founder was convicted on four counts in January 2022 for persuading investors over 15 years that she had developed a revolutionary medical device before the company flamed out after an investigation by The Wall Street Journal. The company even attracted investments from high-profile moguls, including Rupert Murdoch, the Walton family, and former Education Secretary Betsy DeVos.

Prosecutors said she lied to investors from 2010 to 2015 as her company's machines did not work as promised. Theranos ultimately dissolved in September 2018. She has been asked to pay Rupert Murdoch the entire $125m he invested in her failed start-up.

Ms. Holmes founded Theranos in 2003 at the age of 19 after dropping out of Stanford University. She was named the world's youngest self-made billionaire at age 30 after Theranos was valued at $9 billion. As of 2023, that figure has fallen to $0.