How JPMorgan Lost $175 Million To One Con Woman

One young woman with a bright business model fooling an established finance sector giant, getting embroiled in a court case, and garnering extensive media attention– you might think it’s a summary of the Anna Delvey story! Not really, but close. This is the tale of Charlie Javice. The Wharton School graduate duped renowned financial services provider JP Morgan Chase into buying her student aid platform, Frank, for $175 million. Her tactic? Drumming up details of 4.6 million customers out of thin air.

It all began with the 25-year-old Javice founding Frank, a platform that aimed to make the application process for student loans faster and simpler, in 2016. Her application won support from big names like Marc Rowan, and prominent venture backers such as Chegg, Gingerbread Capital, and SWAT Equity Partners. In 2019, Javice said her app was serving 300,000 people. By 2019, the year JP Morgan Chase acquired the start-up, she claimed that the number of users was above 5 million.

With JP Morgan Chase acquiring Frank, Javice became a managing director at the giant. She received close to $10 million for the merger and negotiated for a $20 million retention bonus for the future. Frank’s chief growth officer Olivier Amar, received about $5 million from the deal.

Behind closed doors, Javice paid a data science professor at a New York City area college $18,000 to use data from some Frank users and forge 4.265 million fake customer accounts. She had it validated by a third-party vendor, alleges JP Morgan Chase. Amar, too, made himself useful, buying a data set of 4.5 million students from ASL Marketing for $105,000.

Deal done, JP Morgan Chase wanted to get down to real business. They asked for Frank’s customer list so they could begin marketing their products and services to those students. After some resistance, citing privacy concerns, the duo sent the data they had derived from ASL and Enformion. JP Morgan Chase got to work, sending 400,000 test emails. They were hit hard by disastrous results. They could send only a quarter of the emails, of which only one percent were opened.

Soon, JP Morgan Chase found out the students didn’t exist. They fired Amar in October and Javice in November 2022 and filed a suit against them. Evidence shows “she layered fraud upon fraud to deceive. Javice and Amar used the fake customer list and other knowingly false Merger Agreement representations to fraudulently induce JPMC to enter into the merger,” the lawsuit said.

Javice filed a suit against JP Morgan Chase, too. Her complaint said that the bank failed to harness Javice and Frank’s potential, and instead pursued “poorly conceived business plans” focused on “Frank’s historical customers.” She alleged that “Chase grossly mismanaged its investment from the start, and it decided it would rather walk the investment back than work on it further.”

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