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Theranos Founder Charged With Massive Fraud by SEC

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Elizabeth Holmes, founder and chief executive of scandal-ridden blood-testing startup Theranos, Inc., has been formally charged with fraud by the U.S. Securities and Exchange Commission (SEC) alongside the company’s former president, Ramesh “Sunny” Balwani, for their role in fleecing investors of more than US$ 700 million using grossly exaggerated claims about the efficacy and business potential of their core product. Theranos and Holmes have agreed to settle the charges levied against them in court, with Holmes agreeing to pay US$ 500,000 in penalties, according to an announcement from the commission.

As part of the settlement, Holmes has forfeited her shares and voting control of Theranos and been barred from serving as an officer or director of a public company for the next 10 years. No such agreement was made with Balwani, who will face the SEC’s lawyers in federal district court in the Northern District Court of California. The charges come nearly two years after the SEC first began its investigation into Theranos, following an explosive report published by The Wall Street Journal in October 2015 quoting former employees that claimed the company’s revolutionary blood-testing equipment was built on a sham.

Big Dreams

A Stanford dropout whose penchant for black turtlenecks and promising technological marvels once drew comparisons to Silicon Valley deity Steve Jobs, Holmes captivated investors in 2003 with her pitch to develop a portable blood analyzer that could run a comprehensive suite of tests using only a few drops of blood, and at a fraction of the cost of devices currently on the market. In truth, however, Theranos’ mythical proprietary technology – dubbed the Edison machine after the prolific inventor – turned out to be capable of only a small fraction of what was promised, with the vast majority of tests being ran on traditional machines manufactured by companies like Siemens.

Attracting Big Names

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Trump Goes Across the Political Aisle to Nominate Nellie Liang to Federal Reserve Board

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U.S. President Trump nominated Nellie Liang to the Federal Reserve Board of Governors. She is a long-time staff member of the Federal Reserve, joining in 1986 as a research economist. Liang must still be confirmed by the U.S. Senate pending the job post. She is a graduate of University of Notre Dame in 1979 and received her doctorate from the University of Maryland in 1986.

Ms. Liang is a registered Democrat.

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Ivanhoé Cambridge to Acquire Callahan Capital Properties

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Ivanhoé Cambridge, a unit of Caisse de dépôt et placement du Québec (CDPQ), signed a deal to acquire Callahan Capital Properties (CCP). Eastdil Secured advised on the transaction. CCP is Ivanhoé Cambridge’s investment partner of six years.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Manager of China’s Foreign Reserves Could be CalPERS Next CIO

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Numerous financial media outlets, including the Wall Street Journal (WSJ), are reporting that Ben Meng is in key position to become Chief Investment Officer of CalPERS. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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