Silicon Valley CEO gets 8-year prison sentence in case over blood-testing company that gives off Elizabeth Holmes-Theranos vibes.
A Silicon Valley executive who lied to investors about inventing technology that tested for allergies and COVID-19 using only a few drops of blood was sentenced Wednesday to eight years in prison and ordered to pay $24 million in restitution, federal prosecutors said.
Mark Schena, 60, was convicted last year of paying bribes to doctors and defrauding the government after his company billed Medicare $77 million for fraudulent COVID-19 and allergy tests, the US Department of Justice said in a statement.
Schena claimed his Sunnyvale, California-based company, Arrayit Corporation, had the only laboratory in the world that offered “revolutionary microarray technology” that allowed it to test for allergies and COVID-19 with the same finger-stick test kit, prosecutors said.
In meetings with investors, Schena claimed he was on the shortlist for the Nobel Prize and falsely represented that Arrayit could be valued at $4.5 billion, prosecutors said.
Before the COVID-19 pandemic, from 2018 through February 2020, Schena and other employees paid bribes to recruiters and doctors to run an allergy screening test for 120 allergens ranging from stinging insects to food allergens on every patient whether they were needed or not, authorities said
The case against Schena shared similarities with a more prominent legal saga surrounding former Silicon Valley star Elizabeth Holmes, who dropped out of Stanford University in 2003 to found a company called Theranos that she pledged would revolutionize health care with a technology that could scan for hundreds of diseases and other issues with just a few drops of blood, too.
Her company, which was valued at $9 billion at its height, ultimately defrauded some $750 million from investors, according to the SEC.
Holmes also managed to convince a slew of powerful men to sit on Theranos’ board, including politicians like former Secretaries of State Henry Kissinger and George Shultz, businessmen like former Wells Fargo CEO Richard Kovacevich, and even public health administrators like William H. Foege, former director of the Centers for Disease Control and Prevention.
Holmes was convicted on four felony counts of investor fraud following a nearly four-month trial in the same San Jose, California, courtroom where Schena’s trial was held.
Though Holmes had requested to remain free on bail as she appealed her conviction, her request was denied. In May, she entered a Texas prison where she was originally slated to spend 11 years. Her prison term has since been shortened to around 9 and half years.
Source: Businessinsider
