- After being on the Forbes 30 Under 30 list, Charlie Javice is moving closer to trial for defrauding JPMorgan Chase of $175 million.
- The feds say she defrauded the world’s largest bank into buying her financial aid technology startup, Frank.
- On Thursday, she lost her bid to be tried separately from a former colleague who plans to attack her.
After being on the Forbes 30 Under 30 list, former tech entrepreneur Charlie Javice is awaiting trial next month on charges that she defrauded JPMorgan Chase into paying $175 million for her college financial aid startup, Frank.
The jury may be in for a wild ride.
Javice’s former No. 2 at Frank, defendant Olivier Amar, intends to base his defense on the attack on her, it was revealed at a preliminary hearing in federal court in Manhattan on Thursday.
“We only found out on Jan. 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 Miss Javice’s waiver,” said the lawyer.
U.S. 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 court and jury time and it would just be unnecessarily duplicative to have two trials when there could be one,” the judge said.
“This is simply an adversarial defense – certainly nothing that would lead to something that is unfair to either of the defendants.”
A young entrepreneur and the biggest bank in the world
According to the indictment against them, Javice and Amar together defrauded the nation’s largest bank into paying a small fortune to Frank, a profitable technology company she launched at age 24 that featured software to help students apply for aid financial in college.
Javice began attracting JPMorgan Chase in the summer of 2021. Then, 28, Javice was something of a media darling, giving interviews to major news outlets and making not only Forbes’ list but Crain’s New York for 40 under 40.
“Don’t wait for the time to step up in the traditional sense” during a negotiation, Javice told Business Insider in July 2021. That was the same month prosecutors say she provided JPMorgan Chase with two Power Point presentations alleging that Frank it had more than 4 million users.
“If you see an opportunity, don’t be afraid to jump,” she told BI afterward.
It was these claims of a massive user base that attracted JPMorgan Chase. The bank bought Frank, in large part, to gain access to these users, hoping these prospective 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 purchase, Javice and Amar called 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 text message cited by prosecutors. “We don’t want to end up with orange jumpsuits.”
Their engineer left. So the pair paid $18,000 to an outside data scientist, who generated what prosecutors say were 4 million rows of completely fabricated names, emails, home addresses and phone numbers.
“The defendants created a false database,” Assistant U.S. Attorney Micah Festa Fergenson said at Amar’s sentencing in July. “It was basically a giant Excel spreadsheet that had over 4 million rows and a lot of assumed data. But it was all fake.”
The sale was completed in September 2021, with JPMorgan Chase holding Javice and Amar as the no. 1 and no. 2 of Frank. As JPMorgan Chase’s new head of student solutions, Javice was paid an annual salary of $300,000 and pocketed $21 million in stock plus a $20 million retention bonus, prosecutors allege.
Knowing that the bank would soon try to use the data to set up savings accounts, credit cards and the like, the pair then bought for $100,000 on the open market the records of more than four million college students , prosecutors claim.
“When Chase eventually went and asked them, ‘Okay, send the list of student records,’ they sent this list of students that they had purchased on the open market,” Fergenson alleged in Amar’s indictment.
Just a year after the sale, JPMorgan Chase realized that Frank had no more than 300,000 legitimate user contacts — and that the remaining 4 million contacts were essentially invalid.
“Chase ran a test run of a marketing campaign,” the prosecutor said at Amar’s trial. “A lot of the emails were old and didn’t work. Almost nobody clicked on it. And it was completely unexpected.”
The bank shut Frank down, firing him 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 at her Miami Beach home. Amar has been released 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 is simply based on the bank’s December 2022 lawsuit.
Amar’s lawyers have said that he was distant from the sale itself and that he did not knowingly participate in any scheme.
Charlie Javice arrives in Federal Court. John Minchillo/AP
A last minute evidence repository
On Thursday, the original date for jury selection – the second Monday in February – was pushed back a week to February 18. The judge moved the date to give the defendants more time to process a last-minute emergency deposition of evidence from the government.
Describing the snafu to the judge, prosecutors said that 14 months earlier, in October 2023, they obtained two large caches of data in response to a Google subpoena: all of Javice’s Google Drive documents and all of Javice’s Amar’s Google Drive.
Prosecutors immediately shared Javice’s car documents with her defense team and all of Amar’s car documents with his team — 13,000 documents in all — as required by federal rules of evidence. But they neglected to give Javice Amar’s documents and vice versa.
“How would you like to receive 13,000 documents two weeks before trial?” asked the judge angrily. “How did this happen?”
Javice, meanwhile, remains in the dark about what Amar’s “waiver” defense will entail once the case goes to trial, her lawyers complained Thursday.
Will it just be “finger pointing?” Sullivan asked the court.
Or will Miss Javice be followed not only by the government, but also by Mr. Amar? he asked. “At least we know what the government will say. We have no idea what Mr. Amar will say.”