{"id":98385,"date":"2016-11-18T12:12:17","date_gmt":"2016-11-18T17:12:17","guid":{"rendered":"http:\/\/countingpips.com\/?p=98385"},"modified":"2016-11-18T07:14:06","modified_gmt":"2016-11-18T12:14:06","slug":"shocking-twist-in-the-theranos-fraud-story","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2016\/11\/shocking-twist-in-the-theranos-fraud-story\/","title":{"rendered":"Shocking Twist in the Theranos Fraud Story"},"content":{"rendered":"
November 18, 2016<\/div>
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By WallStreetDaily.com<\/u><\/a> \"Shocking<\/p>\n

The Wall Street Journal<\/strong> has revealed that the key whistleblower on blood-testing startup Theranos\u2019 fraud is none other than the grandson of company director and former Secretary of State George Shultz.<\/strong><\/i><\/p>\n

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Like many of the long-running narratives of our time, it started with a whistleblower.<\/p>\n

But there\u2019s a legitimately shocking twist in this story, revealed this week by The Wall Street Journal<\/em>: The 26-year-old truth-teller who brought down Theranos Inc. is the grandson of George Shultz.<\/p>\n

That\u2019s the very same George Shultz who served as Richard Nixon\u2019s Secretary of the Treasury and Ronald Reagan\u2019s Secretary of State.<\/p>\n

And it\u2019s the same George Shultz who served on the board of directors of Elizabeth Holmes\u2019 \u201crevolutionary\u201d blood-testing startup.<\/p>

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Theranos insiders tried to marginalize and simultaneously patronize Tyler Shultz in an effort to render him just another Snowden or Assange.<\/p>\n

Sunny Balwani, the president and chief operating officer, \u201cbelittled Mr. Shultz\u2019s grasp of basic mathematics and his knowledge of laboratory science,\u201d says the Journal.<\/em><\/p>\n

Balwani also suggested, strongly, that Tyler\u2019s concerns were only addressed because he\u2019s George\u2019s grandson.<\/p>\n

And now the grandson is estranged from the grandfather, a schism within one of the most notable families on the right side of the Establishment continuum.<\/p>\n

Tyler Shultz and his family have now incurred nearly half a million dollars in legal fees due to his efforts to expose Theranos\u2019 fraud.<\/p>\n

As he told the Journal\u2019s<\/em> John Carreyrou, \u201cFraud is not a trade secret. I refuse to allow bullying, intimidation and threat of legal action to take away my First Amendment right to speak out against wrongdoing.\u201d<\/p>\n

And now the grandson is estranged from the grandfather, a schism within one of the notable families on the right side of the Establishment continuum.<\/em><\/strong><\/p>\n

It seems pretty clear now that Tyler Shultz was a key anonymous source who helped Carreyrou break the story of Theranos\u2019 deceptive research and testing procedures.<\/p>\n

As we wrote on September 9<\/strong><\/a>: \u201cThe red flag that sent The Wall Street Journal<\/em> healthcare reporter John Carreyrou on a quest for answers was Holmes\u2019 inability to adequately explain, with any specificity, what her company\u2019s primary product actually did and how it actually did it.\u201d<\/p>\n

Indeed, as Nick Bilton discussed in his September 6, 2016, Vanity Fair<\/em> piece on the sordid affair, \u201cNo scientist could credibly vouch for Theranos. Under Holmes\u2019 direction, the secretive company had barred other scientists from writing peer-review papers on its technology.\u201d<\/p>\n

As Carreyrou reported in a November 16 story for the Journal:<\/em><\/p>\n

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Mr. Shultz\u2019s allegations that Theranos\u2019 proprietary Edison machines frequently failed quality-control checks and produced widely varying results were corroborated in inspection results released in March by the federal Centers for Medicare and Medicaid Services. In April, Theranos told regulators it had voided all test results from Edison machines for 2014 and 2015, as well as some other tests it ran on conventional machines.<\/p>\n<\/blockquote>\n

Tyler was motivated by a desire to protect his grandfather\u2019s reputation. But now he communicates with George through lawyers.<\/p>\n

The elder Shultz\u2019s reputation \u2014 along with those of fellow former Secretary of State Henry Kissinger, former Secretary of Defense William Perry and former Sen. Sam Nunn \u2014 is one of the factors that supported Theranos\u2019 meteoric trajectory.<\/p>\n

These four Establishment pillars were all fellows at the Hoover Institution, a conservative think tank affiliated with Stanford University.<\/p>\n

Stanford is the alma mater of Theranos founder Elizabeth Holmes. Tyler Shultz took a mechanical engineering degree from the famed Palo Alto campus.<\/p>\n

Wrote Carreyrou: \u201cThe unusually high-profile board gave Theranos an aura of power, connections and gravitas as it raised money from investors and developed the blood-testing devices Ms. Holmes touted as revolutionary.\u201d<\/p>\n

Power, Connections, Gravitas: That would be an apt motto for a Neoliberal Establishment crest.<\/p>\n

Is Tyler Shultz a hero? Perhaps in the context of the times, simply telling the truth is a heroic act.<\/p>\n

Measured against the weight of what may fall on those who spill the beans, sure, \u201chero\u201d fits.<\/p>\n

Power, Connections, Gravitas: That would be an apt motto for a Neoliberal Establishment crest.<\/em><\/strong><\/p>\n

Consider Chelsea Clinton\u2019s effort to \u201cinvestigate\u201d donations to the Clinton Foundation and their connection to separate business activities conducted by longtime family consigliere Doug Band.<\/p>\n

Email traffic disclosed by Julian Assange\u2019s WikiLeaks as part of the \u201cPodesta\u201d package and reported by Zero Hedge reveals an effort to quash, via intimidation, Chelsea Clinton\u2019s concerns about propriety.<\/p>\n

\u201cI hope that you will speak to her and end this,\u201d Band wrote to Podesta. \u201cOnce we go down this road\u2026\u201d<\/p>\n

Yeah, it\u2019s messy. But the Neoliberal Establishment is a mess. That much is clear in the aftermath of its candidate\u2019s historic loss in the 2016 presidential election.<\/p>\n

Here \u2014 what Lambert Strether of the blog Naked Capitalism describes as \u201ca lovely metaphor\u201d \u2014 is a compelling picture drawn by J.D. Alt, author of The Millennials\u2019 Money<\/strong><\/em><\/a>, of what ails the left side of the Neoliberal Establishment continuum:<\/p>\n

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If the forest is not healthy, however, the mature trees are highly vulnerable to certain events. Windstorms and ice storms, for example, can bring down huge swathes of what appeared to be strong, mature trees overnight. In this light, we would have to say, in retrospect (although we\u2019ve certainly sensed it for some time now), that the \u201cneoliberal American forest\u201d was not in good health. Under its bark, its hidden structure was eaten away by the doubts, worries and insecurities of the 99% of the population whose incomes and quality of life were headed in the wrong direction.<\/p>\n

The neoliberal trees may have honestly thought<\/em> they were feeding the 99%, but in fact they were starving them. A case in point, which has never been adequately accounted for, is the fallout of the American mortgage crisis. The fact that on the day of the election<\/em>, 3.2 million families were still underwater in their mortgages \u2014 paying more each month to a corrupt banking system than their houses are worth, unable to sell, unable to move to make a new beginning and find a new job, constantly threatened with a downgrade in their credit rating, unmotivated or unable to make repairs or upgrades, living in neighborhoods blighted with empty windows and unkempt yards \u2014 the magnitude of that reality alone should have suggested there might be a lot of voters not much interested in maintaining the status quo. The fact that the neoliberal Obama-Clinton coalition, from day one of the Great Recession, didn\u2019t understand (or simply ignored) the devastating and insidious impact the housing collapse was going to have on the lives of the American middle class is still, from my perspective, one of the greatest miscues of modern American politics.<\/p>\n<\/blockquote>\n

Tyler Shultz would rather not have to spend more than $400,000 on lawyers to justify his attempt to keep his grandfather\u2019s name and reputation clean and intact. Of course, he probably would have liked for Theranos to be a legitimate company.<\/p>\n

Chelsea Clinton would rather her mother had won the White House. And she, too, would probably like there to be no question of her parent\u2019s financial and moral integrity.<\/p>\n

They would \u2014 if offered a choice \u2014 favor the status quo.<\/p>\n

But here we are.<\/p>\n

The Neoliberal Establishment is in crisis.<\/p>\n

At least its second- and third-generation scions are asking questions of it.<\/p>\n

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Old Things New<\/h2>\n

The 1970 concept album Blows Against the Empire<\/em> may be credited to both Paul Kantner and<\/em> Jefferson Starship,\u201d but it\u2019s a Kantner operation all around. It actually predates the formal founding of Starship by about four years.<\/p>\n

It\u2019s not the most famous work the guitarist, singer and songwriter participated in; he was, after all, a co-founder of Jefferson Airplane.<\/p>\n

But it was the first rock album ever nominated for a Hugo Award, a set of honors given for achievement in science fiction and fantasy.<\/p>\n

Contributors include Jack Casady and Joey Covington of Jefferson Airplane; Jerry Garcia, Bill Kreutzmann, and Mickey Hart of The Grateful Dead; David Crosby and Graham Nash of the \u201csupergroup\u201d Crosby, Stills, Nash & Young; and David Freiberg of Quicksilver Messenger Service.<\/p>\n

Kantner, who died on January 28, 2016, tells the story of \u201ca bunch of left-wing hippies closely resembling his San Francisco Bay Area compatriots,\u201d as William Ruhlmann of All Music Guide describes it, drawing heavily on ideas espoused by the author Robert Heinlein.<\/p>\n

The album concept strikes a chord here because of its theme of interplanetary exploration and resettlement: Kantner\u2019s revolutionaries \u201chijack a government-built starship and head off to restart the human race on another planet.\u201d<\/p>\n

The lead track \u201cMau Mau (Amerikon)\u201d includes the first reference to Ronald Reagan in a rock song.<\/p>\n

It also resonates because of this line: \u201cGet out of the way, let the people play\u2026\u201d<\/p>\n

Smart Investing,<\/p>\n

David Dittman
\nEditorial Director, Wall Street Daily<\/i><\/p>\n

The post Shocking Twist in the Theranos Fraud Story<\/a> appeared first on Wall Street Daily<\/a>.<\/p>\n

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 <\/p>\n","protected":false},"excerpt":{"rendered":"

By WallStreetDaily.com The Wall Street Journal has revealed that the key whistleblower on blood-testing startup Theranos\u2019 fraud is none other than the grandson of company director and former Secretary of State George Shultz. Like many of the long-running narratives of our time, it started with a whistleblower. But there\u2019s a legitimately shocking twist in this […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-98385","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/98385","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=98385"}],"version-history":[{"count":3,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/98385\/revisions"}],"predecessor-version":[{"id":98398,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/98385\/revisions\/98398"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=98385"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=98385"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=98385"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}