Charlie Javice, college financial aid startup founder, found guilty of defrauding JPMorgan

Charlie Javice, the woman accused of swindling JPMorgan Chase into acquiring her now-shuttered college financial aid company, was found guilty on Friday.

Federal prosecutors accused Javice, 32, of “falsely and dramatically” inflating the number of her company’s customers to entice JPMorgan Chase into buying it. The company, Frank, was supposed to make it easier to file for financial aid through the government’s Free Application for Federal Student Aid (FAFSA).

She was indicted in 2023 on charges of securities fraud, wire fraud, bank fraud, and conspiracy, two years after JPMorgan Chase bought her startup for $175 million.

Javice could face a maximum of 30 years in prison on the charges of wire fraud, bank fraud and conspiracy. Securities fraud carries a slightly lower maximum sentence of 20 years.

Jennifer Roberts, head of Chase consumer banking, told CNBC at the time of the 2021 acquisition that the goal in buying Frank was to expand its connection to college students and have “lifelong, engaged relationships” with the rising consumer base.

However, the deal began to unravel after the financial institution attempted to obtain information on the purported 4.25 million Frank users, finding that Javice only had verifiable data for about 300,000, prosecutors said.

During closing arguments, Assistant U.S. Attorney Nicholas Chiuchiolo told the jury that Javice hired an outside person to fabricate consumer data after her head of engineering refused.

Her attorney, Jose Baez, described the prosecution’s case as “incredibly flawed” and lacking in evidence. Javice was not called to testify in the case.

Olivier Amar, Javice’s chief growth officer, was also charged in the case as a defendant. He didn’t testify at trial, and his attorneys attempted to distance Amar from Javice.

Prosecutors accused Amar of working with Javice to defraud JPMorgan Chase during the merger deal, but Amar’s defense was that Javice acted on her own, according to Bloomberg.