Privilege and PR: Unpacking the Theranos Scam
Creators: name: Mammadli, Banu
Publisher: name: American University
Year: 2023
Subjects: classificationCode: 48
subject: Law and legal studies

description: The trials of Elizabeth A. Holmes and Ramesh “Sunny” Balwani shocked the world. This reaction was mainly attributed to the previously pristine public image of Holmes: an empowering female figure in the business and science field, all the while intermingling with the socialites with the world; an image not exactly associated with what society expects of a con-artist.
The case at hand deals with the meticulate scam orchestrated by Holmes and Balwani to promote their once acclaimed business “Theranos.” The health and science company specializing in disease testing was founded by Holmes, with Balwani serving as the president and chief operating officer. The scheme, birthed around 2013, involved the defendants making “materially false and misleading statements to investors and failing to disclose material facts”[1] through the utilization of false and misleading written, as well as verbal statements, in Theranos’ communications, marketing, financial statements, models, media, and so on. Thus, the defendants were charged with two counts of conspiracy to commit wire fraud against both doctors and the company’s patients, as well as nine counts of wire fraud.
Holmes also appears to have utilized her status in socialite circles and the public eye to consciously target affluent families and those that ran in socialite circles for investors. This was done as an effort to ensure that these targeted investors wouldn’t notice a lack of return on their investments after certain periods of time, seeing as less affluent investors or those more involved in the field might have questioned when they were going to receive financial gain from their investment. Moreover, Holmes and Balwani were often deflective of questions regarding the scientific and technical aspects of their product by claiming that revealing too much would make Theranos vulnerable to attacks or theft from rival corporations. These tactics allowed their scheme to continue with minimal intervention from investors.
Similarly, the public hardly inquired about the validity of Theranos’ practices, seeing as Holmes had become an empowering figure for women in the STEM and business world. In her fall, Holmes not only brought down herself, Balwani, and her corporation, but also the feminist movement to an extent. However, the case of Holmes also exemplified another critical issue in society at large: Holmes is a white, seemingly affluent woman, which meant that her successes and abilities were left largely unquestioned by both the public and her investors, thus allowing her scheme to succeed for so long. Alternatively, women of colour and otherwise marginalized people often have to jump through hurdle after hurdle to prove themselves,their achievements, and capabilities as valid. While this stark contrast is deeply unsettling, it is a necessary truth for society at large to come to terms with, so that social and systemic change may be enacted. Furthermore, though white men are indisputably more powerful than white women, we cannot discount the privileges that white women hold[2] and the ways in which society tends to jump at any chance to idolize them without actual merit.
Holmes’ scheme has unequivocally served as a notable setback for the feminist movement. While women have worked throughout history to assert their professionalism and capabilities in the workplace and field of STEM in particular, Holmes has put all that work at risk. The unmasking of Holmes’ scheme allowed misogynists to support their antiquated claims, such as that women are inherently vindictive or that they shouldn’t be handling money. Nonetheless, these beliefs have been held by society long before Theranos, making it unfair to use Holmes as a scapegoat for such misogynistic messages.
Furthermore, it would be unjust to neglect the fact that the majority of white-collar crimes, such as Holmes and Balwani’s scheme, often go untried,[3] which brings into question whether Holmes has been singled out due to her identity as a woman in a male dominated field, or simply because the justice system is beginning to repair itself by revoking leniency towards affluent criminals. This said, the issue is not in any way that Holmes is being tried, but rather that her male counterparts in Silicon Valley’s extensive white collar-crime industry should be as well. Rather than advocating for Holmes under the basis of her being a woman prosecuted for a crime that men often aren’t, the attention of activists should be going towards classism and the countless working class ‘criminals’ that have been incarcerated, seeing as the repercussions of life after incarceration are much more dire for this group. This is especially significant, seeing as the nature, wealth, and power of large corporations in the U.S., such as Theranos, are inherently exploitative and unethical to begin with.Whether or not they indulge in white-collar crimes is simply not relevant.
In conclusion, the case of Holmes and Balwani demonstrates the dangers of the exploitation of power. This said, the result of Elizabeth Holmes’ trial may not be the heart of this issue, but this scandal may rather be a cautionary tale regarding power, deception, and the fact that affluent white women will always be in a position of power over all other classes, second only to wealthy white men.