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Elizabeth Holmes, founder and CEO of the collapsed Silicon Valley blood testing company, Theranos, has been sentenced to 11.25 years in prison plus three years supervised release for financial crimes she committed while running the once-high flying venture, YahooFinance reported. Holmes was also fined a $400 special assessment. Holmes must surrender to custody on April 27, 2023. Holmes is expected to appeal. The judge presiding over Holmes’ trial and sentencing said the landmark case, one of the most closely watched in Silicon Valley history, should be a cautionary tale for startup founders who are willing to overhype the capabilities of their products. “I suppose we step back and ask what is the pathology of fraud? Is it the refusal to accept responsibility or express contrition in any way?" Judge Edward Davila said. "Perhaps that is the cautionary tale that will go forward from this case." Before the sentencing, Judge Davila said that under the U.S. Sentencing Guideline considerations, the court found that Holmes should serve between 11.25 years and 14 years in prison. The court's calculation as to the "reasonable total loss" sustained by identified victims of the fraud to total $121.1 million.

A federal judge struck down President Biden’s student loan forgiveness plan on Nov. 10. The ruling is being challenged, but that hasn’t stopped scammers eager to capitalize on borrowers’ confusion and frustration, the Wall Street Journal reported. Scams targeting Americans impatient for debt forgiveness surged in the first 10 months of 2022, according to the Federal Trade Commission. The agency received 76,000 complaints of scams related to student loans through the end of October, compared with 46,243 for all of 2021. Scammers sprinkle details from the latest headlines to add urgency and authenticity, with some claiming they can fast-track applications and payments, federal officials said. “Scammers follow the news. So a seasoned scammer will weave in language from actual loan benefits and loan programs along with things that are purely fraudulent,” said Michelle Grajales, a staff lawyer for the Federal Trade Commission. “They might promise to get you $60,000 of loan forgiveness next month.”

Elizabeth Holmes urged a U.S. judge not to send her to prison, as the founder of Theranos Inc. prepares to be sentenced next week for defrauding investors in the blood testing startup, Reuters reported. In a Thursday night court filing, lawyers for Holmes asked that she receive 18 months of home confinement, followed by community service, at her Nov. 18 sentencing before U.S. District Judge Edward Davila in San Jose, California. The lawyers said prison time was unnecessary to deter future wrongdoing, calling Holmes, 38, a "singular human with much to give" and not the robotic, emotionless "caricature" seen by the public and media. "No defendant should be made a martyr to public passion," the lawyers wrote. "We ask that the court consider, as it must, the real person, the real company and the complex circumstances surrounding the offense."Prosecutors are expected to file their sentencing recommendation soon. A jury convicted Holmes in January on four counts of wire fraud and conspiracy. Each count carries a maximum 20-year prison term. Any sentence would likely be served concurrently.

Two former MoviePass Inc. executives were charged with securities and wire fraud for allegedly scheming to defraud investors of the parent of the bankrupt company, Bloomberg News reported. Theodore Farnsworth, 60, of Miami, and J. Mitchell Lowe, 70, of Miami Beach, are accused of making false representations relating to Helios & Matheson Analytics Inc., which bought MoviePass in 2017 and ran it until it collapsed into bankruptcy in 2020. Farnsworth is the former chief executive officer of Helios & Matheson, while Lowe was MoviePass’s CEO from 2016 to 2020. Prosecutors allege the two men told investors that MoviePass’s plan to allow subscribers to see unlimited movies in theaters for $9.95 had been tested, was sustainable and would be profitable — while knowing it was simply a “temporary marketing gimmick” to gain new customers, artificially inflate the stock price and attract investors. They are also accused of falsely claiming that the company had technology that allowed it to generate revenue by analyzing and monetizing the data it collected from subscribers, and made misleading statements “about the positive impact that multiple revenue streams (other than subscription fees) were having on MoviePass’s profitability and self-sufficiency.”

A Michigan real estate investor has been charged in federal court with multiple counts of bankruptcy fraud totaling more than $1.1. million, MLive.com reported. Sean Phillip Tissue is accused of multiple counts of concealment of assets, false oaths, false declarations and withholding recorded information as part of the scheme. Tissue is the owner of numerous companies, including Greystone Home Builders, Sycamore Homes, Sycamore Construction, Lenovo Homes, and Metro Detroit Home Solutions. He was previously charged in August in a wire fraud scheme in which he allegedly defrauded Israeli investors of more than $600,000 in fraudulent real estate investments. “This defendant used a number of apparently legitimate companies, sophisticated methods, and lies to defraud potential real estate investors, many from outside the United States. He then declared a fraudulent bankruptcy in an effort to avoid re-paying his victims.” said United States Attorney Dawn N. Ison in a statement. “Today’s charges demonstrate our commitment to ensure the integrity of our bankruptcy system.” Tissue faces maximum penalties of five years in prison, a $250,000 fine, and up to 3 years supervised release. A federal district court judge will determine the sentence.