Charlie Javice, the founder of student-finance startup Frank, was convicted on Friday of defrauding JPMorgan Chase & Co. in connection with the bank’s $175 million acquisition of her company.
The verdict was delivered by a Manhattan federal jury after a six-week trial that concluded with just six hours of deliberation.
Javice, 32, was found guilty on multiple counts, including bank fraud, after prosecutors successfully argued that she fabricated data to falsely inflate Frank’s user base.
While Javice claimed her platform had more than 4.25 million users, evidence showed the actual number was closer to 300,000.
The deception, prosecutors said, was critical to securing JPMorgan’s purchase of the startup in 2021.
Javice, visibly shaken by the outcome, sat silently as the verdict was read.
Her co-defendant, Olivier Amar, who was also found guilty, looked down and shook his head. Friends and family members seated in the courtroom appeared stunned.
Sentencing will take place at a later date.
Though Javice faces up to 30 years in prison on the most serious charge, legal experts suggest she is likely to receive a significantly shorter sentence.
The verdict marks a dramatic fall for Javice, once celebrated as a rising star in fintech.
Frank was launched in 2016 with the mission of simplifying the college financial aid process.
Frank aimed to assist students in navigating the Free Application for Federal Student Aid (FAFSA), claiming to streamline the application process and increase accessibility.
Javice’s innovative approach garnered her spots on prestigious lists such as Forbes’ “30 Under 30” in 2019.
Praised for its student-friendly tools and aggressive growth strategy, the company quickly drew national attention — and eventually that of the nation’s largest lender, JPMorgan Chase.
The relationship began to unravel in late 2022 when the bank filed a lawsuit against Javice, accusing her of grossly misrepresenting the company’s metrics.
The complaint alleged that she and Amar hired a data science firm to generate a fake list of users to support inflated claims during due diligence.
The Department of Justice later filed criminal charges, including wire fraud, securities fraud, and conspiracy.
Javice, who was arrested in April 2023 and released on a $2 million bond, pleaded not guilty and maintained her innocence throughout the trial.
Her legal team argued that JPMorgan had access to accurate data and failed to conduct proper due diligence before the deal.
Prosecutors, however, described a calculated scheme to mislead investors and secure a lucrative deal through deceit.
Witnesses testified that they were asked to create fictitious information, while emails and internal documents presented during the trial painted a clear picture of intentional misconduct.
This story originally appeared on NYPost
