Charlie Javis, founder of Frank, a student loan application startup that JPMorgan purchased for $175 million, committed on Friday for fraudulent banks by significantly inflating customer numbers.
After a five-week trial, the ju judges found Javice guilty and agreed to the prosecutor’s claim that he produced the majority of Frank’s client list to deceive JPMorgan.
When JPMorgan bought Frank in 2021, the bank thought the startup had 4 million customers. The bank found that the actual customer numbers later sent test marketing emails to suspected frank users, and about 70% of those messages bouncing off.
Javice is said to have hired a mathematics professor to create fake customer data. I submitted it to JP Morgan while the bank was considering purchasing the company.
The defense attorneys argued that the lawsuit was the result of buyers’ regret due to a government change in the way financial aid forms were filled out. Javice pleaded not guilty and did not stand up during the trial.
Havis, now 32, could be sentenced to decades in prison. The ruling is expected to take place in August, according to a CNBC report.
Havis founded Frank in 2017 when he was in his mid-20s. In 2019, she was named to the Forbes 30 under 30 list.
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