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Charlie Javice, the founder of the now-defunct financial aid startup Frank, has been convicted in a federal court for deceiving JPMorgan Chase & Co. into acquiring her company for $175 million in 2021 by significantly inflating its customer base.
The jury’s verdict was reached following several weeks of testimonies in New York, where the focus was on accountability for the rapid failure of what was once regarded as a promising venture. Established in 2016, Frank sought to simplify the process for students applying for college financial aid.
In its civil suit, JPMorgan accused Javice of misleading the bank by claiming that Frank had over 4 million customers, whereas the actual figure was closer to 300,000. This discrepancy has been at the heart of the legal battle, raising questions about due diligence and transparency in startup valuations.
Beginning in 2023, Javice was confronted with four criminal charges from the Justice Department, including wire and bank fraud, each carrying a potential sentence of up to 30 years in prison.
A representative for JPMorgan has opted not to make a public statement regarding the case.
This story is developing. Please check back for updates.
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