When Charlie Javice sold her financial aid startup Frank to JPMorgan Chase for $175 million in 2021, she seemed to be living the dream of every 20-year-old founder.
But the takeover has since turned into a nightmare for Javice, who was arrested in April and charged by the US Securities and Exchange Commission with alleged fraud at JPMorgan Chase. CNN business reported.
Javice now pleads not guilty to the counts of conspiracy, wire fraud and bank fraud; the cause of action was filed through her attorney late last week, AP News reported.
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The bank filed a lawsuit against Javice in December; She was accused of creating a list of four million users with the help of a professor and artificial intelligence. But Javice claimed the bank was trying to cover up its own failed strategy, and countersued for damages and $27.9 million in compensation it says it owes. The Wall Street Journal reported.
That was stated in a complaint filed in a New York district court SEC stated that Javice convinced JPMorgan Chase that their app had 4.25 million users – when in fact it had fewer than 300,000. The SEC’s investigation found that by selling Javice in 2021, it would receive “$9.7 million directly in stock proceeds, millions more indirectly through trust funds and a contract that entitles her to a $20 million retention bonus.” stole.
“Rather than helping the students, we allege that Ms. Javice committed an old-fashioned scam: She lied about Frank’s success in helping millions of students navigate the college financial aid process by fabricating dates to show their… to substantiate allegations, and then used that falsified information.” “to get JPMC to close a $175 million transaction,” said Gurbir S. Grewal, director of the SEC’s Enforcement Division.
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