Charlie Javice Convicted of Defrauding JPMorgan Over Deal (2)

Charlie Javice was found guilty of defrauding JPMorgan Chase & Co. in its $175 million acquisition of her student-finance startup, Frank, following a six-week trial.

A Manhattan federal court jury delivered its verdict Friday against Javice, 32, finding that the onetime entrepreneur lied and faked user data to convince the nation’s largest bank that her site had more than 4.25 million users when it actually had fewer than 300,000. The jurors deliberated for about six hours before reaching their decision.

Charlie Javice exits federal court in New York on March 28.

Photographer: Christian Monterrosa/Bloomberg

Javice faces a maximum prison term of 30 years on the most serious count of bank fraud when she is sentenced, though she’s likely to receive a far lower sentence than that.

She looked saddened when the verdict was read out. Her co-defendant, former Frank chief growth officer Olivier Amar, who was also found guilty, looked at the floor and shook his head. Members of Javice’s family and supporters in the front row appeared shocked. Both defendants were convicted on all four counts — conspiracy, wire fraud, securities fraud and bank fraud — and both will remain free before sentencing.

Up and Coming

A University of Pennsylvania Wharton School graduate whose company attracted investors including Apollo Global Management Inc. co-founder Marc Rowan, Javice was one of several young entrepreneurs with elite backgrounds prosecuted for fraud in recent years. Like FTX co-founder Sam Bankman-Fried, Javice was once named one of Forbes magazine’s “30 under 30” up-and-coming young business leaders.

Javice’s trial also shed some light on JPMorgan’s due diligence process. Though the bank had some 350 staffers involved in vetting the 2021 deal, it failed to detect the fraud and twice turned down offers to have Frank’s data verified by an outside firm it hired. A data scientist whom Javice paid $18,000 to create “synthetic” user data for JPMorgan testified that a few calls to those users would have revealed them to be fake.

Lawyers for Javice tried to get jurors to focus on those failings, suggesting that JPMorgan didn’t really care about Frank’s user numbers and was more concerned about buying the company before another bank did. JPMorgan executive Leslie Wims Morris, the bank’s former corporate development head, testified that her team wrongly thought that Bank of America Corp. was also bidding for Javice’s company.

Pablo Rodriguez, a spokesman for JPMorgan, declined to comment on the verdict Friday.

Amar’s lawyers spent much of the trial trying to show their client wasn’t present for key meetings and wasn’t on many of the emails, phone calls and Zoom meetings where alleged lies were told. They pointed out that various witnesses testified to communicating exclusively with Javice, particularly when user figures were discussed. In the end, it didn’t help.

Frank, which JPMorgan shut down in early 2023, offered a tool to help students fill out their Free Application for Federal Student Aid, or Fafsa, which is required by most colleges in making financial aid decisions. Prosecutors showed jurors a video of Javice walking users through the process. Students who completed their Fafsa forms on the site provided a wealth of additional demographic and financial data along with their names, emails, home addresses and phone numbers.

Attraction for Bank

Wims Morris, who is now chief executive officer of JPMorgan’s automotive loan unit, stressed on the stand that Frank’s data was very important to JPMorgan because the bank’s goal was to cross-market banking services to the site’s users. She said the banks saw the deal as a way to quickly add millions of new customers in the 18-to-24 age demographic.

Javice said that Frank was on track to have 10 million users by the end of 2021, Wims Morris testified. The JPMorgan executive said she “100%” trusted the young entrepreneur on Frank’s user numbers.

Javice’s creation of fake user data in response to a JPMorgan due diligence request was at the heart of the prosecution’s case. Frank’s former engineering chief, Patrick Vovor, testified that he turned Javice down when she asked him to do it.

“I asked them if it was even legal, this request,” said Vovor, now a senior engineering manager at JPMorgan. “I told them that I would not do anything illegal.”

‘Ms. Gordy Does Not Exist’

On the same day Vovor refused, Javice contacted Adam Kapelner, a data scientist she met while they were both studying at Wharton. Kapelner testified that he created data to Javice’s specifications but that she refused to tell him why she needed it.

He described in detail how he created millions of fake users by recombining elements of Frank’s real user data. He was asked about a supposed Frank user named Katherine Gordy who had an address, phone number, email and other personal and financial information.

“Ms. Gordy does not exist,” Kapelner told the jurors.

A JPMorgan marketing executive testified that, after the deal closed, red flags were raised when an attempt to pitch banking services to Frank users yielded only 10 new checking account customers.

Though JPMorgan was wrong in thinking Bank of America was bidding for Frank, the jury heard from Capital One Financial Corp. executive Mason Young about that bank’s withdrawn offer to acquire Javice’s company for $125 million. Prosecutors claim she also lied to Capital One about Frank’s user numbers.

The case is US v. Javice, 23-cr-251, US District Court, Southern District of New York (Manhattan).

--With assistance from Steve Dickson.

To contact the reporters on this story:
Bob Van Voris in federal court in Manhattan at rvanvoris@bloomberg.net;
Jazper Lu in New York at jlu669@bloomberg.net;
Chris Dolmetsch in Federal Court in Manhattan at cdolmetsch@bloomberg.net

To contact the editors responsible for this story:
Anthony Lin at alin364@bloomberg.net

Peter Jeffrey, Anthony Aarons

© 2025 Bloomberg L.P. All rights reserved. Used with permission.