Charlie Javice, the founder of the now-defunct fintech startup Frank, has been convicted of defrauding JPMorgan Chase out of $175 million. A U.S. federal court found her guilty of fabricating customer data to inflate the company's value before selling it to the banking giant.
JPMorgan acquired Frank in 2021, believing it had over 4 million student users. However, an internal investigation later revealed that the actual number was far lower. Prosecutors argued that Javice had created fake user profiles to deceive JPMorgan into completing the deal.
Following the acquisition, JPMorgan shut down Frank's operations and filed a lawsuit against Javice, which led to her arrest. The court's decision marks a significant legal precedent in cases of financial fraud within the fintech sector. Javice now faces potential sentencing, with penalties that could include substantial fines and imprisonment.