- Once on Forbes’ 30 under 30 list, Charlie Javice is approaching trial in a $175 million JPMorgan stalking fraud.
- 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.
Once 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.
Lawyers can be in for a wild ride.
Javice’s former No. 2 in Frank, codefendant Olivier Amar, intends to base his defense on attacking her, it was revealed at a preliminary hearing in federal court in Manhattan on Thursday.
“We only found out on January 8 that the defense was going to be antagonistic,” Javice’s attorney Ronald Sullivan told the judge who ordered that she and Amari be tried separately.
“The defense will be to impeach Miss Javice,” 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 simply be unnecessarily duplicative to have two trials when there could be one,” the judge said.
“That’s just an antagonistic defense — certainly nothing that would amount to something that’s unfair to the defendant.”
A young entrepreneur and the biggest bank in the world
According to the indictment against them, Javice and Amar together wired the nation’s largest bank to pay a small fortune to Frank, a for-profit technology company she started at age 24 that featured software to help students apply for aid. college finances.
Javice began defrauding 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 also Crain’s 40 Under 40 New York.
“Don’t wait for the time to raise the bar 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 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 won Frank, in large part, to gain access to these users, hoping that these future college students will 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 told the engineer in a text message cited by prosecutors. “We don’t want to end up in orange sweatshirts.”
Their engineer was blocked. So the pair paid $18,000 to an outside data scientist, who generated what prosecutors say were 4 million rows of completely fabricated names, e-mails, home addresses and phone numbers.
“The defendants created a false database,” Assistant U.S. Attorney Micah Festa Fergenson said at Amar’s arraignment 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 went through in September 2021, with JPMorgan Chase holding Javice and Amar as No. 1 of Frank and No. 2 A $20 million retention bonus, prosecutors allege.
Knowing 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, data on more than four million college students. the college, prosecutors claim.
“When Chase eventually went and asked them, ‘Okay, send your list of student records,’ they sent this student list that they had purchased on the open market,” Fergenson alleged at Amar’s arraignment.
It wasn’t until a year after the sale that JPMorgan Chase realized that Frank didn’t have more than 300,000 legitimate user contacts—and that the rest of the 4 million contacts were essentially invalid.
“Chase ran a test 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 on it. And it was completely unexpected.”
Frank closed the bank, 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 Miami Beach home. 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 lawfully obtained and did not constitute fraud — and that the government’s case merely piggybacks on the bank’s December 2022 lawsuit.
Amar’s lawyers have said he was at arm’s length from the sale itself and that he knowingly did not participate in any scheme.
Charlie Javice arrived in federal court. John Minchillo/AP
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 piece of evidence from the government.
In 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 Google Drive’s documents of Amar.
Prosecutors immediately shared Javice’s Drive documents with her defense team, and all of Amar’s drive documents with his team — 13,000 documents in all — as required under the 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?” the judge demanded angrily. “How did this happen?”
Javice, meanwhile, remains in the dark about what Amar’s “Derogation” defense will entail once the case goes to trial, her attorneys complained Thursday.
Will it just be “fingerprinting?” Sullivan asked the court.
“Or will Miss Javice be pursued by the Government 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.”