No, Elizabeth Holmes Did Not Dupe the Prison System

The media just cannot get enough of Elizabeth Holmes.

Last week the Theranos fraudster made headlines yet again – but this time, she did nothing to warrant the excessive attention.

The barrage of headlines about Holmes’ prison term were enough to fool even our editorial team at first glance.

“Seriously?!” MD+DI Managing Editor Katie Hobbins said in a Microsoft Teams chat, with a link to The Independent’s story, “Elizabeth Holmes has two years shaved off her sentence, records show.”

“She’ll be out before you know it,” MD+DI Editor-in-Chief Omar Ford replied.

At least half a dozen other news outlets ran with similar headlines. They weren’t technically wrong, but they were misleading.

The problem is many of us already view Holmes as a master manipulator and con artist. So, when these headlines pop up in our news feeds, it’s all too easy to jump to the conclusion that Holmes is getting preferential treatment like so many white-collar criminals who came before her.

She must have hoodwinked the prison system the same way she bamboozled investors out of all that money, we assume. Some might even wonder if officials were fooled by the New York Times’ soft-focus profile on “Liz Holmes.”

The reality is far less dramatic.

I was just about to take the bait and jump on this so-called breaking news myself last week when a Twitter notification gave me pause. It came from Dorothy Atkins, senior editor at Law360, whose coverage of both Theranos fraud trials was second to none.

“Just b/c people don’t understand the criminal justice system, doesn’t mean this is news. Bad unethical reporting is framing this as if Elizabeth Holmes duped the system. She didn’t. Her release date includes a reduction for good behavior – not guaranteed. I reported it last year,” Atkins said in a re-tweet of a Forbes story.

“Elizabeth Holmes – Theranos Fraudster and Ex-Billionaire – Quietly Cuts Two Years Off Prison Sentence,” Forbes tweeted on Tuesday.

So, what started this latest hubbub about Holmes?

She reported to Federal Prison Camp Bryan on May 30, but the Federal Bureau of Prisons (BOP) has listed her expected release date as Dec. 29, 2032. That would make her prison term about two years shorter than the 11.25 years the judge sentenced her to.

If you think that seems like a bunch of bull, keep reading because it gets worse.

Trying to understand how the BOP came up with that release date, I dug in deep and learned more than I ever wanted to know about the criminal justice system.

Inmates may receive up to 54 days of good conduct time (GCT) credit for each year of the sentence imposed by the court, according to the First Step Act of 2018. GCT is calculated at the beginning of a sentence and can be taken away if the inmate acts up. That makes Holmes eligible for about 608 days of GCT, which is why she is currently expected to be home by the end of 2032.

But there are so many loopholes at play in the federal prison system that I predict Holmes will leave prison in November 2029, if not before. Let that sink in.

On top of GCT, the First Step Act established a ridiculously generous (and complicated) time credits program. Eligible inmates can earn up to 15 days of time credits for every 30 days of successful participation in what’s called evidence-based recidivism reduction programs and productive activities. This includes an array of self-improvement programs, including several specifically designed for women.

Some criminal justice experts estimate that Holmes could earn up to 960 days of First Step Act credits. Of that, 365 would go toward reducing her time served, and another 595 days would go toward home confinement.

And finally, under the Second Chance Act of 2007, Holmes should be able to spend the final six months of her prison term in home confinement anyway.

So, yeah, Ford was correct in our editorial Teams chat when he said Holmes will be out before we know it.

But it will be because of a bunch of legal loopholes, not because of preferential treatment or because she somehow duped the prison system.