Massive Fraud Femme Fitale

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According to Masunaga and Peterson, four years ago, the Silicon Valley firm Theranos Inc. was valued at $9 billion and its founder and Chief Executive Elizabeth Holmes was hailed as a potentially revolutionary force in the blood-testing industry. Today, she is deemed a fraudster.

Questions:

  1. Theranos’ proprietary analyzer could only perform __________ of the 200 tests on the company’s website regarding the blood test analyzer.  How did they do the other tests?
  2. In May 2016, what did the company do regarding the results of tens of thousands of blood tests that doctors had depended on to care for patients over the previous two years?
  3. What has happened to the company since this time?
  4. When did the company’s downfall begin?
  5. Who do you think were the big losers in this story of fraud?
  6. What was Holmes’ role in the fraud?

Source:

Masunaga, S. and M. Petersen. (2018). Theranos and CEO Elizabeth Holmes committed “massive fraud,” SEC alleges. LA Times, March 14 (Retrievable online at http://www.latimes.com/business/la-fi-theranos-elizabeth-holmes-20180314-story.html)