- Once on Forbes’ 30 Under 30 list, Charlie Javice is nearing trial on a $175M JPMorgan Chase fraud.
- The feds say she tricked the world’s largest bank into buying her financial aid tech startup, Frank.
- On Thursday, she lost her bid to be tried separately from an ex-colleague who plans to attack her.
Once on Forbes’ 30 Under 30 list, former tech entrepreneur Charlie Javice is awaiting trial next month on charges that she tricked JPMorgan Chase into paying $175 million for her college financial aid startup, Frank.
Jurors may be in for a wild ride.
Javice’s former No. 2 at Frank, codefendant Olivier Amar, intends to base his defense on attacking her, it was revealed at a pretrial hearing in federal court in Manhattan on Thursday.
“We learned this only on January 8, that the defense was going to be antagonistic,” Javice’s attorney Ronald Sullivan told the judge in asking that she and Amar be tried separately.
“The defense will be the derogation of Miss Javice,” the lawyer said.
US District Judge Alvin K. Hellerstein quickly denied the request for separate trials. Javice and Amar are charged with “a common plan or scheme,” the judge explained.
“This trial is a complicated trial. It will take weeks of the court’s and the jury’s time, and it would just be unnecessarily duplicative to have two trials when there can be one,” the judge said.
“This is merely an antagonistic defense — certainly nothing that would rise to something that is unfair to either defendant.”
A young entrepreneur, and the world’s largest bank
According to the indictment against them, Javice and Amar together conned the nation’s largest bank into paying a small fortune for Frank, a for-profit tech company she launched at age 24 that featured software to help students apply for college financial aid.
Javice began wooing JPMorgan Chase in the summer of 2021. Then 28, Javice was something of a media darling, giving interviews to major news publications and making not only the Forbes list, but the Crain’s New York’s 40 under 40 list as well.
“Don’t wait for the time to move up the ranks in the traditional sense” during a negotiation, Javice told Business Insider in July 2021. That was the same month that prosecutors say she gave JPMorgan Chase with two Power Point presentations alleging Frank had more than 4 million users.
“If you see an opportunity, don’t be afraid to jump,” she told BI then.
It was these claims of a massive user base that lured JPMorgan Chase in. The bank acquired Frank, in large part, to gain access to these users, hoping that these up-and-coming college students would become new customers for Chase products, federal prosecutors say in court documents.
When the bank asked to verify Frank’s user database before committing to the acquisition, Javice and Amar called up their director of software engineering. They asked the engineer to create synthetic data that would make it look like they had millions of users, prosecutors allege.
“Yes, it’s legal,” Amar allegedly told the engineer in a message cited by prosecutors. “We don’t want to end up in orange jumpsuits.”
Their engineer balked. So the pair paid $18,000 to an outside data scientist who generated what prosecutors say were 4 million rows of utterly fabricated names, emails, home addresses, and phone numbers.
“The defendants created a fake dataset,” Assistant US Attorney Micah Festa Fergenson said at Amar’s arraignment in July. “It was essentially a giant Excel spreadsheet that had over 4 million rows and lots of purported data. But it was all fake.”
The sale went through in September 2021, with JPMorgan Chase keeping Javice and Amar on as Frank’s No. 1 and No. 2. As JPMorgan Chase’s new head of student solutions, Javice was paid a $300,000 annual salary and pocketed $21 million in stock proceeds plus a $20 million retention bonus, prosecutors allege.
Knowing the bank would soon try to use the data to pitch savings accounts, credit cards, and the like, the pair then purchased, for $100,000 on the open market, the data for more than four million college students, prosecutors allege.
“When Chase eventually went and asked them, “Okay, send your student data list,” they sent this student list that they had bought on the open market,” Fergenson alleged at Amar’s arraignment.
Only a year after the sale did JPMorgan Chase realize that Frank had no more than 300,000 legitimate user contacts — and that the remainder of the 4 million contacts were essentially worthless.
“Chase did a test run of a marketing campaign,” the prosecutor said at Amar’s arraignment. “A lot of the emails were old and didn’t work. Almost nobody clicked through to it. And it was completely unexpected.”
The bank shut Frank down, firing and suing Javice. She was arrested in April 2023, he was arrested three months later. Both have pleaded not guilty to charges of conspiracy to commit securities, wire, and bank fraud.
Javice is free on $2 million bail, which was secured by her home in Miami Beach. Amar is out on $1 million bail.
Javice’s lawyers have argued that the materials sent to JPMorgan Chase during the 2021 sale negotiations were legally obtained and did not constitute fraud — and that the government’s case simply piggybacks on the bank’s December 2022 lawsuit.
Amar’s lawyers have said that he was at arm’s length from the sale itself and that he did not knowingly participate in any scheme.
A last-minute evidence dump
On Thursday, the original date for jury selection — the second Monday in February — was pushed forward a week to February 18. The judge moved the date to give the defendants more time to process an emergency, last-minute evidence dump from the government.
Describing the snafu to the judge, prosecutors said that 14 months ago, back in October 2023, they received two large caches of data in response to a subpoena to Google: all of Javice’s Google Drive documents and all of Amar’s Google Drive documents.
Prosecutors immediately shared Javice’s drive documents to her defense team, and all of Amar’s drive documents to his team — a total of 13,000 documents — as required under federal rules of evidence. But they neglected to give Javice’s documents to Amar, and vice-versa.
“How would you like to get 13,000 documents two weeks before trial?” the judge demanded angrily. “How did that happen?”
Javice, meanwhile, remains in the dark on what Amar’s “derogation” defense will involve once the case does go to trial, her lawyers complained on Thursday.
Will it be mere “finger-pointing?” Sullivan asked in court.
“Or will Miss Javice not only be prosecuted by the government but also by Mr. Amar?” he asked. “At least we know what the government is going to say. We have no idea what Mr. Amar is going to say.”
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