The Next SBF? Charlie Javice Charged With Fraud After Selling Financial Aid Startup ‘Frank’ to JPMorgan

Charlie Javice, the founder behind student loan startup Frank, is facing criminal charges related to alleged financial fraud related to her previous business dealings with JPMorgan Chase.

The 31 year-old entrepreneur was charged with securities fraud, bank fraud, conspiracy, and wire fraud affecting a financial institution on Tuesday by federal prosecutors from Manhattan, whilst also facing civil fraud charges by the SEC. The allegations stem from a civil suit filed by JPMorgan Chase last year after buying her startup Frank for $175 million and discovering she grossly exaggerated the number of customers her financial aid company had amassed.

Javice’s attorney refrained from commenting on the matter, but Javice herself previously asserted to Business Insider that she’d filed a countersuit against JPMorgan accusing the bank of firing her “in bad faith” in an effort to forego paying a $20 million retention bonus. If found guilty, Javice could face up to 30 years imprisonment; however, such fraud cases at the federal level typically result in significantly less jail time than the maximum sentence.

JPMorgan purchased Frank— a microfinance company supposedly armed with an innovative strategy to help post-secondary students secure substantially more financial aid— for a whooping $175 million back in 2021. At the time, Javice claimed Frank secured around $28,000 in funding for each student, which was shockingly nearly twice the amount otherwise disbursed to post-secondary attendees for the 2015-2016 year.

Javice also told JPMorgan that Frank had more than 4.25 million users, when in reality the startup only had about 250,000 students using the service. The bank uncovered her dubious claims after a failed email marketing campaign targeting 400,000 students resulted in 70% of the emails bouncing back, and only 103 of them actually being opened. In JPMorgan’s suit against Javice, the bank said an follow-up internal investigation determined that she, along with Frank’s chief growth officer Olivier Amar, gave $18,000 to a science data expert to produce nearly 4 million fake accounts that ultimately enticed JPMorgan into the deal.

“This arrest should warn entrepreneurs who lie to advance their businesses that their lies will catch up to them, and this Office will hold them accountable for putting their greed above the law,” wrote Attorney Damian Williams in a statement.

Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Mergers Set the Stage for Uranium’s Growth Cycle | Forum-Baselode Merger

The Goal is Gold Production as Soon as Possible! | Gordon Robb – ESGOLD Corp.

Snowline Gold: The Multi Billion Dollar Valley PEA

Recommended

First Majestic Produces 7.9 Silver Equivalent Ounces In Q2, Lifts Production Guidance

Antimony Resources Drills 4.17% Antimony Over 7.4 Metres At Bald Hill

Related News

JPMorgan Weighs Full Return to Office for All Staff

JPMorgan Chase & Co is developing plans to end remote work entirely, potentially becoming the...

Saturday, January 11, 2025, 07:36:00 AM

JPMorgan to Acquire Credit Card Rewards Company on Hopes that Travel Rebounds in 2021

With the global travel industry still down in the dumps amid the raging coronavirus pandemic,...

Thursday, December 31, 2020, 10:42:00 AM

JPMorgan Sues Tesla for $162.2 Million Over Breach of Contract

It appears that Elon Musk’s inflamed twitter finger was at it again, except this time...

Tuesday, November 16, 2021, 02:46:00 PM

Home Builder Charged After $37M Fraud Left Hundreds Without Houses

Three executives from a collapsed Ontario home construction company have been charged by provincial regulators...

Monday, May 26, 2025, 11:24:00 AM

Reddit Confession Leads to Unraveling of International Student’s Academic Fraud

A 19-year-old international student from India has been arrested for fabricating documents to secure a...

Saturday, July 6, 2024, 09:11:00 AM