Charlie Javice, the former CEO of financial aid startup Frank, was found guilty of defrauding JPMorgan Chase out of $175 million by vastly inflating her company's customer numbers.
A jury in Manhattan delivered the verdict on Friday after a five-week trial, marking the latest high-profile tech fraud case.
Javice, 32, founded Frank in her mid-20s, claiming to simplify the complicated Free Application for Federal Student Aid (FAFSA) process.
Her company promoted itself as a tool to help students secure financial aid more easily in exchange for a small fee.
The startup gained widespread media attention, and Javice even earned a spot on Forbes' "30 Under 30" list.
In 2021, JPMorgan acquired Frank, believing it had over four million users and could serve as a pipeline for young banking customers.
However, an internal investigation later revealed the company only had around 300,000 actual users.
Prosecutors alleged that Javice and her co-defendant, Olivier Amar, fabricated millions of fake customer records to inflate Frank's value.
JPMorgan executives testified that they relied on Javice's exaggerated claims during acquisition talks.
When the bank requested proof of Frank's user base, Javice allegedly paid a data expert $18,000 to generate fake accounts.
The fraudulent data was then submitted to a third-party verifier, which failed to detect the deception.
Charlie Javice who is Jewish was convicted of defrauding JPMorgan out of $175 million for the sale of her phony financial aid startup. She lied to them saying she had 4.5 million students in her program when there were only about 300.000, this should tell you something about lies pic.twitter.com/NdCHPNaLz1
— Lonnie Lewis (@The80bigL) March 28, 2025
Charlie Javice and Olivier Amar Convicted of Conspiracy and Fraud Charges
According to Business Standard, Patrick Vovor, Frank's chief software engineer, testified that Javice had asked him to create synthetic customer data.
When he questioned the legality of the request, she and Amar assured him it was fine. Vovor refused to participate, later becoming a key witness for the prosecution.
Javice's attorney, Jose Baez, argued that JPMorgan knew the actual size of Frank's customer base but pursued fraud charges out of buyer's remorse.
He claimed regulatory changes made the acquisition less valuable to the bank, prompting them to target Javice.
Despite this defense, the jury found Javice and Amar guilty on all four counts, including conspiracy, bank fraud, and wire fraud. Each charge carries a maximum sentence of 30 years in prison, AP News said.
The judge will hear arguments next week regarding whether Javice and Amar must wear ankle monitors while awaiting sentencing, scheduled for July 23.
Javice's conviction highlights a pattern of young tech founders facing legal consequences for misleading investors.
Her story draws comparisons to Elizabeth Holmes, the disgraced founder of Theranos, who was convicted in 2022 for defrauding investors with false claims about her company's blood-testing technology.
Javice, who has been free on $2 million bail since her 2023 arrest, currently resides in Florida. Her legal team has requested a review of the verdict, arguing the evidence was insufficient to support a conviction.
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