"NEW YORK -- Charlie Javice, the founder of a startup company that promised to revolutionize the way college students apply for financial aid, was sentenced Monday to more than seven years in prison for cheating JPMorgan Chase out of $175 million by greatly exaggerating how many students it served. Javice, 33, was convicted in March of duping the banking giant when it bought her company, called Frank, in the summer of 2021."
"Javice was among a number of young tech executives who vaulted to fame with supposedly disruptive or transformative companies, only to see them collapse amid questions about whether they had engaged in puffery and fraud while dealing with investors. Her prosecution drew comparisons to the case against Elizabeth Holmes, the founder of a blood testing company, Theranos, that collapsed amid fraud allegations."
"Still, the judge criticized the bank, saying "they have a lot to blame themselves" after failing to do adequate due diligence. He quickly added, though, that he was "punishing her conduct and not JPMorgan's stupidity." Javice, who lives in Florida, has been free on $2 million bail since her 2023 arrest. The judge said she could remain free while she appeals the verdict."
Charlie Javice received a sentence of more than seven years in prison for defrauding JPMorgan Chase of $175 million by greatly exaggerating her startup Frank's customer base. Javice claimed Frank had over 4 million customers when the company had fewer than 300,000 at the time of its 2021 sale to JPMorgan. The judge criticized the bank's due diligence but emphasized that the sentence punished Javice's conduct. Javice expressed remorse in court and said she regretted her decision. The case drew comparisons to Theranos and Elizabeth Holmes. Javice was convicted of conspiracy, bank fraud, and wire fraud and remains free on $2 million bail pending appeal.
Read at ABC7 Los Angeles
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