U.S. prosecutors want Charlie Javice, the 33-year-old founder of college aid startup Frank, to spend 12 years in prison. They argue that her scheme to trick JPMorgan (JPM) into paying $175 million for a business built on fake data was not a minor lapse but a full-scale fraud. In a late-night court filing, prosecutors described her conduct as “audacious” and driven by “personal greed and ambition.”
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Jurors already found her guilty on four counts earlier this year, including bank fraud, securities fraud, and conspiracy. Now the focus shifts to her sentencing on September 29, where prosecutors also want her to forfeit $29.7 million and cover more than $300 million in restitution, including JPMorgan’s legal costs. They say a light punishment would fail to capture the seriousness of her crimes.
Javice Tries to Show Remorse
Only days ago, Javice sent a letter to U.S. District Judge Alvin Hellerstein, saying she accepts the verdict and “takes full responsibility” for what happened. “There are no excuses, only regret,” she wrote, adding that she is “truly sorry.” Her lawyers have asked for a far shorter sentence, portraying her actions as a one-time “lapse of judgment” in an otherwise law-abiding life.
They insist that JPMorgan, the country’s biggest bank, was not significantly harmed by the scheme given its size and deep resources. Prosecutors disagree, pointing out that JPMorgan ended up with a useless acquisition and a high-profile embarrassment that CEO Jamie Dimon himself called “a huge mistake.”
Startup Darling Turns to Deception
Frank was launched in 2017 to simplify college financial aid and quickly earned Javice a spot on Forbes’ “30 Under 30.” By 2021, she convinced JPMorgan the company had 4.25 million users, when in reality the figure was closer to 300,000. When JPMorgan bought Frank, the bank soon discovered it couldn’t even email most of the supposed customer list. That revelation unraveled the entire deal.
In addition, prosecutors said Javice went to great lengths to back up her claims, commissioning fabricated lists and obstructing attempts to verify Frank’s user base. They argue this shows the scheme was deliberate, sustained, and far from the “aberration” her lawyers now describe.
Javice Will Learn Her Fate Later This Month
Javice will learn her fate later this month. Prosecutors say even their 12-year request is lighter than the minimum 22 years normally recommended under sentencing guidelines for crimes of this scale. Her co-defendant, Olivier Amar, who served as Frank’s chief growth officer, faces his own sentencing in October after being convicted on the same charges.
The case has become one of the most high-profile examples of startup hype turning into outright fraud.
Is JPMorgan a Good Stock to Buy?
Despite the embarrassment of the Frank acquisition, Wall Street analysts remain constructive on JPMorgan’s future. According to TipRanks, 19 analysts have weighed in over the past three months, with the consensus landing at a “Moderate Buy.”
The average 12-month JPM price target sits at $306.44, which is almost flat compared with the bank’s latest share price.
