By: Aviral Agrawal

5/5 - (3 votes)


It is very important for people to know about JPMorgan Chase got scammed, mot so ‘Framl’ after all. In September 2021, JP Morgan Chase bought Charlie Javice’s FinTech startup Frank for $175 million with a user base of 4 million, which comes to $45 per user. FinTech, which focused on Gen Z college students, aimed to improve the student loan application process to get financial aid.

Also, it helped in negotiating with the colleges to get higher financial aid. In the United States, students must complete the FAFSA forms, which the US government has made extremely complicated to separate the most serious candidates from the rest. Frank identified this problem and saw that, on average, a student graduates with a loan of $30,000.

Who is Charlie Javice?

Charlie Javice, the founder of Frank, came from a family of wealthy venture capitalists and studied in France before joining Wharton Business School. In 2016, she revolutionized the student loan process and raised funds. She attracted top investors like Apollo Global Management, Reach Capital, Ginger Bread Capital, and SWAT Equity Partners. Charlie soon started gaining attention and got featured in Forbes’ 30 Under 30 list. Frank started attracting well-known financial institutions like JPMorgan Chase.

Why did JPMC acquire Frank?

The problem with this startup was that they were not generating any revenue as they helped students file the FAFSA forms for free, thus the only way to generate monetary gain was to sell the company. The company claimed that it had a user base of 4 million students, due to which JPMorgan Chase acquired Frank for $175 million. But the question that got raised was: why would a bank acquire a FinTech startup with no source of revenue at such a high valuation? Data was the answer to that question. They bought the 4 million students’ data for $45 per user. JPMC appointed Charlie as MD at JPMC, overseeing student-focused products.

The ‘Chase’

In January, 2022, JPMC decided to spam 400,000 random emails to gain customers as even if 10% of the total user base gained by JPMC as their bank users, would lead JPMC to cover the cost of the acquisition of Frank. JPMC only delivered 28% of the mails and less than 1% opened them. JP Morgan suspected that something fishy was going on and found the actual number of users to be only 300,000, which is less than 10% of what Charlie Javice had claimed.

The Scam – anti – ‘Frank’

Charlie Javice simply outplayed the bank. She inflated the user base by providing fake data. Charlie Javice and the company’s chief growth officer, Olivier Amar, reached ASL Marketing. ASL Marketing is a company that has the most accurate and responsive data on high school students, college-going students, and young adults.

They paid ASL Marketing $105,000 and bought a list of 4.5 million students. Further, she hired a data science professor to make up the fake data. They brainstormed and decided it would not be workable to make up fake addresses and emails, so they developed the idea of unique IDs and made the bank believe the duo connected the unique IDs to actual addresses and email addresses in the backend, which was false.

Charlie Javice and the company’s chief growth officer used the email IDs bought from ASL Marketing instead. The duo told JPMC that, right now, they can only provide the name and unique IDs of the students, as it would breach their data privacy policy. JPMC did due diligence and Frank passed.

The Mistake – Leaving the evidence at the crime spot

What seemed to be a perfect ending acquisition by JPMC had one imperfection. Frank made one mistake, as claimed by the JPMC, she sent the emails from Frank company’s mail ID, and they have the transcripts of her talks with the professor.

The professor sent a bill of $13,300 elaborating further on his services, which included college major generation, creating first and last names, emails, phone numbers, etc. As any sharp auditor would have asked questions about these details, Charlie Javice asked to remove it all and instead make a bill of $13,300 for Data Analysis services and paid $4,300 as a bonus, probably to conceal the facts. After the acquisition, Javice offered the professor a full-time position at JPMC and hired him.


In conclusion, Javice paid $193,000 in total to ASL Marketing, the professor, and others for a list of fake email addresses and then sold the startup Frank to JPMC for $175 million, orchestrating the fraud successfully.

JPMC has filed the lawsuit against Javice, although even if they find the allegations true, it is highly unlikely that JPMC will get back the $175 million. CEO Jamie Dimon is calling this acquisition a huge mistake.

On the other hand, JPMC declared a net income of $11 billions in the fourth quarter of year 2022 itself, making it seem a penny lost on a dollar. The due diligence team on the acquisition of Frank is surely going to be in a lot of trouble for sure.

By: Aviral Agrawal

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