Theranos and Ms Holmes, its founder, claimed that Edison, their invention, a portable blood analyser, could conduct comprehensive tests using tiny amounts of blood taken from a pinprick on the finger, rather than vials filled with blood taken from veins.
Instead, in a criminal indictment, the Justice Department says that Holmes and her then-boyfriend, former President and COO Ramesh "Sunny" Balwani, perpetrated "a multi-million dollar scheme to defraud investors, and a separate scheme to defraud doctors and patients".
In June, an incredibly overconfident Holmes was briefly reported as interested in starting another company, despite the SEC settlement preventing her from serving as an officer of a public firm for a decade. The company grew at a rapid rate in the following ten years, backed by investors who fell in love with Holmes' idea.
According to a report from CNN Money, the Silicon Valley startup's founder and former CEO, Elizabeth Holmes, faces charges of fraud in connection with her practices with the company.
Theranos hit its commercial peak in 2013-14, amassing a $10 billion (£7.7 billion) valuation. The story raised concerns about the accuracy of Theranos' blood-testing technology, which put patients at risk of having conditions either misdiagnosed or ignored.
The Journal's investigation marked the beginning of the end of Theranos.
It accused them of orchestrating an "elaborate, years-long fraud in which they exaggerated or made false statements about the company's technology, business, and financial performance". Balwani is fighting the charges. This led Holmes to step down as CEO of the company and return all remain shares of Theranos.
In July 2016, the Centers for Medicare and Medicaid Services (CMS) revoked Theranos' CLIA license and prohibited Holmes from owning and operating a laboratory for two years.
Information for this article was contributed by staff members of The Associated Press, by Jeff Sutherland of Bloomberg News and by Reed Ableson of The New York Times.