Frank founder Charlie Javice has been charged by the DOJ with fraud in connection to the sale of her financial-aid company to JPMorgan Chase. Javice was arrested on Monday and faces four charges: conspiracy to commit bank and wire fraud, wire fraud, bank fraud, and securities fraud.
- According to the U.S. Attorney’s Office for the Southern District of New York, Javice lied about Frank’s customer base, claiming the financial-aid company had 4.25 million users while it had fewer than 300,000.
- Javice is accused of hiring an outside data scientist to fabricate data for the other few million purported accounts.
- JPMorgan said it learned of the scheme during an email-marketing campaign in early 2022.
- The
first three charges each carry a maximum sentence of 30 years in
prison, while securities fraud has a maximum sentence of 20 years.
- Javice was also sued by the SEC for fraud.
- According to U.S. Attorney Damian Williams, Javice stood to earn $45M from the sale.