Frank Founder Charlie Javice Sentenced to 7 Years for JPMorgan Chase Fraud

Charlie Javice Sentenced in Frank Fraud Case

Charlie Javice, the founder of the financial aid technology company Frank and a former member of the Forbes 30 Under 30 list, has received a seven-year prison sentence following a conviction for fraud.

The Acquisition and Subsequent Allegations

Frank was purchased by JPMorgan Chase in 2021 for $175 million. However, the bank subsequently alleged that Javice misrepresented the company’s user numbers.

Javice reportedly stated that Frank had a customer base of 4 million individuals. The actual number of users was determined to be approximately 300,000. Concerns have been raised regarding the extent of due diligence performed by JPMorgan Chase prior to the acquisition.

Evidence Presented During the Trial

Testimony from a former Frank engineer, Patrick Vovor, revealed that Javice requested the fabrication of user data before the sale. When Vovor refused, Javice sought assistance from Adam Kapelner, a mathematics professor and data scientist.

Kapelner was instrumental in the prosecution’s case, providing crucial evidence regarding the creation of synthetic data. This data was intended to inflate the perceived size of Frank’s user base.

Restitution and Co-Defendant Responsibility

In addition to her prison sentence, Javice, along with her co-defendant Olivier Amar – Frank’s chief growth officer – is jointly responsible for paying $278.5 million in restitution.

This financial obligation aims to compensate for the losses incurred as a result of the fraudulent misrepresentation of Frank’s customer numbers.