Charlie Javice, who made big headlines in 2023 when JPMorgan Chase accused her of faking her start-up’s customer list, was found guilty in federal court Friday of three counts of fraud and one count of conspiracy to commit fraud.
She now faces the possibility of decades in prison.
The bank has its own civil lawsuit on standby as it attempts to claw back some of the $175 million it paid for her company, Frank. It sued her three years ago, and Ms. Javice was arrested at Newark Liberty International Airport not long after that.
Frank, which was founded in 2016, aimed to help customers fill out the Free Application for Federal Student Aid at a time when the FAFSA was notoriously complicated. Ms. Javice, 32, quickly became a go-to quote for journalists writing about paying for college and turned up on lists of under-30 and under-40 up-and-comers.
Not long after Ms. Javice sold Frank to JPMorgan, there was trouble. The bank ran a test of Frank’s customer list, hoping to persuade its young customers to open Chase accounts. Of 400,000 outbound emails, just 28 percent arrived successfully in an inbox.
At trial, a bank executive said that it had opened just 10 accounts via the Frank list. It was, as the bank put it in its own legal filing, “disastrous.”
An internal investigation ensued, and the bank claimed to have found evidence that Ms. Javice and Olivier Amar, Frank’s chief growth and acquisition officer, had faked much of its customer list. JPMorgan sued her, and the federal government followed with its own charges, which resulted in the verdict Friday.
Mr. Amar was charged and tried at the same time as Ms. Javice and was also found guilty on all counts. A JPMorgan spokesman declined to comment on the verdict.
During the trial, JPMorgan bank executives said that one appeal of Frank was its promise of over four million customers, with detailed contact information, whom the bank could pitch. The bank could hook young adults with a checking account and potentially keep them and their business through decades of mortgages and retirement savings.
One striking bit of testimony came from Adam Kapelner, an associate professor of mathematics at Queens College, part of the City University of New York. As JPMorgan was performing due diligence, Ms. Javice told him she was in an “urgent pinch” and asked him to use “synthetic data” to create a list of over four million customers from a Frank list she supplied, which had fewer than 300,000 people on it. He asked why, according to his testimony, but she would not tell him.
“I found my genius,” she said in a text to Mr. Amar at the time.
After Professor Kapelner did some quick work — including pulling an all-nighter — Ms. Javice asked him to remove any specifics about the data from his invoice and paid him $18,000 instead of the $13,300 on his original bill.
According to prosecutors, Ms. Javice and Mr. Amar knew and feared that the bank was going to use Frank’s list for marketing. The pair eventually bought real names and emails from commercial data providers to make it look like Frank really did have millions of customers who had given the company their names and contact information.
This, too, was a rush job to avoid getting caught, according to the prosecution. It produced a text message exchange in which Mr. Amar told Ms. Javice, “You’ll have 4.5 million users today.” She replied, “Perfect. Love you.” Ms. Javice asked for specifics to be removed from an invoice on this transaction as well.
To the prosecution, this was evidence that Ms. Javice was trying to hide her tracks. “Why would you make a fake customer list if you weren’t lying about your customers?” Micah F. Fergenson, an assistant U.S. attorney, said in court Wednesday.
