Theranos and its founder Elizabeth Holmes charged with 'massive fraud'

Federal agency calls disgraced firm, which allegedly deceived investors of $700m, 'an important lesson for Silicon Valley'

The Silicon Valley startup Theranos and its chief executive Elizabeth Holmes were charged by the Securities and Exchange Commission (SEC) on Wednesday with "massive fraud" for raising $700m from investors by allegedly deceiving them about their supposedly groundbreaking blood-testing technology.

Theranos and Holmes agreed to settle the charges without admitting or denying wrongdoing. Holmes, a Stanford dropout who was once hailed as the next Steve Jobs, will pay a $500,000 penalty, return millions of shares to the company, and relinquish her company voting power under the terms of the settlement. She will also be barred for 10 years from serving as an officer or director of a public company.