Millennial Founder Faces Fraud Trial After $175 Million JPMorgan Deal

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Charlie Javice, the founder of the student loan startup Frank, is set to stand trial on February 18 in lower Manhattan, facing charges of fraud related to the sale of her company to JPMorgan Chase for $175 million. According to allegations, Javice misled the bank about the startup's performance and customer base. In 2021, Frank was promoted as a leading college financial planning platform, serving approximately five million students across over 6,000 institutions.

Following the acquisition, JPMorgan's confidence in Frank diminished when a marketing email sent to 400,000 supposed customers revealed a dismal engagement rate, with only 28% delivered and a mere 1.1% opened, suggesting serious discrepancies. The bank subsequently shut down the Frank website in January 2023 and filed a lawsuit against Javice.

The criminal charges against Javice include conspiracy to commit wire fraud and securities fraud, with potential prison sentences of up to 30 years. Amid ongoing litigation, a former executive is anticipated to testify against her. Javice's defense team, led by renowned attorney Jose Baez, remains confident despite recent setbacks, including the departure of high-profile lawyer Alex Spiro from her case.

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