(KRON) — Former Theranos executive Ramesh “Sunny” Balwani began serving a prison sentence Thursday for his role in a fraud conspiracy that rocked Silicon Valley.
U.S. District Judge Edward Davila sentenced Balwani to serve 155 months in prison — nearly 13 years — for defrauding Theranos investors and patients. Balwani’s sentence is two years longer than that given to his co-conspirator and former lover, Elizabeth Holmes.
Balwani remained out of custody throughout his trial. But his freedom vanished Thursday when he reported to prison.
“We can confirm, Ramesh Balwani, is in the custody of the Bureau of Prisons (BOP) at the Federal Correctional Institution (FCI) Terminal Island in San Pedro, California,” Federal Bureau of Prisons spokesperson Donald Murphy told KRON4.
Holmes, who recently gave birth to her second child, was ordered to turn herself in and report to a federal prison on April 27. Prosecutor Kelly Volkar said Holmes is a flight risk, adding, “she has the means and the motive to flee.”
A jury convicted Balwani, 57, of Fremont, on 12 counts of fraud and conspiracy. Holmes, 39, of Woodside, was sentenced to serve 135 months in prison and was convicted on four counts.
The duo defrauded sophisticated investors out of hundreds of millions of dollars by lying about the accuracy of Theranos blood analysis technology, evidence presented at their lengthy trials showed.
As CEO and COO of Theranos, Holmes and Balwani were partners in “everything,” including romantic, business, and criminal partnerships, prosecutors said.
Holmes testified that Balwani controlled her entire life, abused her, and manipulated her. She said Balwani would get very angry with her, constantly criticized her, and told her, “If you follow your instincts, you will fail.”
Balwani was directly in charge of Theranos’ blood lab, finances, and silencing whistleblowers who questioned the company’s technology. Glowing financial profit projections drawn up by Balwani “weren’t just projections, they were lies,” the judge said.
U.S. Attorney Stephanie Hinds said Balwani’s desire to become a “Silicon Valley titan” drove him to value personal wealth over honest business practices.
While Balwani worked behind the scenes, Holmes became a celebrity and America’s youngest self-made billionaire.
The case threw a bright light on Silicon Valley’s dark side, exposing how its culture of hype and ambition could crumble into fraud. Assistant U.S. Attorney Jeff Schenk said, despite all of the biotech startup company’s hype, Theranos was a “house of cards.”
Balwani requested to remain out of prison while he appeals his conviction. The Ninth Circuit Court of Appeals denied his request for freedom and upheld Balwani’s April 20 prison deadline.
Balwani will serve his sentence in a federal prison near a harbor in San Pedro, about 30 miles from downtown Los Angeles. The Terminal Island prison has incarcerated several other prominent figures, including gangster Al Capone in the 1930s and apocalyptic cult leader Charles Manson in the 1950s.
The Associated Press contributed to this report.
