The leader of a company that aims to revolutionize the process for undergraduate financial aid, Charlie Javice, was found guilty of defrauding JPMorgan Chase of$ 175 million by grossly exaggerating her user statistics.
After a five-week trial, a jury in Manhattan’s federal court on Friday delivered the criminal conviction, leaving 32-year-old Javice and her co-defendant Olivier Amar at risk of spending years in prison.
As her verdict was read, Javice continued to remain unrecognisable, her attorney resting with a smile on her up in peace. She walked past writers in the court without making any comments.
When Javice founded Frank, a business that aimed to simplify the notoriously complicated free application for federal student aid ( FAFSA ) process, she was in her mid-20s. Frank, which was developed as a way to facilitate students ‘ quick access to financial aid for a small fee, gained popularity, earning Javice a spot on Forbes ‘ 30 Under 30 list.
In 2021, JPMorgan saw an opportunity and bought the company, believing it had a sizable audience of young consumers. The banks afterwards discovered that the actual figure was only around 300,000 rather than the 4 million people Javice claimed and a a slated 10 million by year’s end.
Frank provided a fabricated customer list, which was generally false.
They might stay and defraud.
According to the prosecution, Javice and Amar, Frank’s main growth and consolidation agent, knowingly misled JPMorgan to stable the multimillion-dollar offer.
Acting Manhattan US attorney Matthew Podolsky said in a statement, quoted by news agency AP, that” Javice and Amar perhaps have thought they could lie and cheat their way to a large cash, but their falsehoods have caught up with them, and they now stand convicted by a judge of their contemporaries.”
Data from the facts presented in court revealed that Patrick Vovor, Frank’s company’s main software engineer, refused to produce synthetic data to support the inflated user numbers. He claimed that when he questioned the constitutionality of the plea, Javice and Amar reassured him, yet joking that they didn’t want to end up “in peach jail jumpsuits.” Otherwise, prosecutors claimed Javice eventually paid a friend from college$ 18 000 to make millions of false names and information.
JPMorgan allegedly had “buyer’s shame,” according to Defense.
Jose Baez, Javice’s attorney, disputed the claim that JPMorgan knew what it was getting when it purchased Frank, claiming that the lender manufactured fraud complaints as a result of “buyer’s shame” after regulatory changes made the information less useful for attracting new customers.
Baez resisted,” They knew the figures,” adding that “JPMorgan is no telling the truth.”
In their charges, Javice and Amar were found guilty of wire fraud, bank fraud, and plot, all of which carry a maximum sentence of 30 years in prison.
Awaiting sentence
Javice, who has been released on a$ 2 million bail since her arrest in 2023, is scheduled to receive her sentencing on July 23. Her defense team has requested that the judge reverse the ruling, arguing that the information was inadequate.
In the meantime, it is still a contentious issue regarding whether Javice and Amar may use ankle monitors while awaiting punishment. Her attorneys contend that the device may interfere with her new job, which she would teach for three to four hours per day.
Next year, Judge Alvin K. Hellerstein will make a decision on these issues.
