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Charlie Javice, the founder of student loan application startup Frank that was purchased by JPMorgan for $175 million, was found guilty on Friday of defrauding the bank by greatly inflating the customer count.<\/p>\n
After a five-week trial, the jury found Javice guilty, agreeing with prosecutors\u2019 claims that she fabricated the vast majority of Frank\u2019s customer list to deceive JPMorgan into acquiring her startup.<\/p>\n
When JPMorgan bought Frank in 2021, the bank thought the startup had 4 million customers. The bank found out that the actual customer count was only 300,000 when it later sent test marketing emails to alleged Frank users and approximately 70% of those messages bounced back.<\/p>\n
Javice allegedly hired a math professor to create fake customer data<\/a>, which she submitted to JPMorgan when the bank was considering buying her company.<\/p>\n Defense attorneys argued that the suit was a result of buyer\u2019s remorse due to a government change in the way financial aid forms are filled out. Javice pleaded not guilty and didn\u2019t take the stand during the trial.<\/p>\n Javice, who is now 32, could be sentenced up to decades in prison. The sentencing is expected to take place in August, according to a CNBC report<\/a>.<\/p>\n Javice founded Frank in 2017 when she was in her mid-20s. In 2019, she was named to the Forbes 30 Under 30 list<\/a>.<\/p>\n<\/div>\n