123. The Acquisition (Charlie Javice)

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Charlie Sheen is an icon of decadence.

I lit the fuse, and my life turns into everything it wasn't supposed to be.

He's going the distance.

He was the highest-paid TV star of all time.

When it started to change, it was quick.

He kept saying, No, no, no, I'm in the hospital now, but next week I'll be ready for the show.

Now, Charlie's sober.

He's gonna tell you the truth.

How do I present this with any class?

I think we're past that, Charlie.

We're past that, yeah.

Somebody call action.

AKA Charlie Sheen, only on Netflix, September 10th.

This episode of Swindled may contain graphic descriptions or audio recordings of disturbing events which may not be suitable for all audiences.

Listener discretion is advised.

LAUSD is incorporating a new teaching tool.

We're talking about artificial intelligence.

Each student will soon have their own individualized AI tool, aka their personal assistant, to help them with everyday tasks and also remind them about schoolwork.

The tool is named Ed and is the first of its kind in the nation and will also be able to accommodate students verbally and on screen in 100 different languages.

On March 20th, 2024, the Los Angeles Unified School District unveiled a new groundbreaking educational tool called ED, a first-of-its-kind learning acceleration platform.

powered by artificial intelligence that could create personalized action plans uniquely tailored to each individual student in the form form of a cheerful, animated, anthropomorphic son.

Oh,

hi.

I'm learning every day just like you.

See you soon.

Ed was essentially a chat bot, no different than something like ChatGPT.

Students and parents could ask Ed about grades, assignments, test results, even the bus schedule.

and Ed would dig into LAUSD's knowledge base and return the answer in seconds in their preferred language.

The bot would also send proactive reminders or nudges about deadlines and attendance via text message, which studies have found to be six to eight times more effective at communicating the same information than an email.

LAUSD's vision was for Ed to become an indispensable resource for all its stakeholders, especially as its usage increased.

Educators would be allowed more time to focus on hands-on instruction, no more phone calls to parents or piles of paperwork.

The learning model would drastically decrease the overwhelming administrative burdens and communication obstacles the teachers encounter on a daily basis.

At the same time, parents would be more informed than ever, and students would receive the right support at the right time.

This would hopefully result in kids remaining enrolled, which was LAUSD's ultimate goal.

Quote: Following the pandemic, we were experiencing massive chronic absenteeism issues, declining academic performance, and disengaged students.

The fully integrated platform combined with a chatbot that provided reminders was our answer to this growing problem and we wanted to use the most advanced technology available.

This most advanced technology was developed by a company called All Here and its CEO, Joanna Smith.

My name is Joanna Smith.

I'm the CEO of All Here and we help schools to curb chronic absenteeism using chatbots powered by AI.

Joanna Smith had spent her entire career in education, every position from a data analyst in Miami to a middle school math teacher and director of family engagement at a charter school in Boston.

It was in that latter position that Joanna recognized the snowball effect that truancy and chronic absenteeism had on a student's education.

For me personally, I became obsessed with solving this problem after having taught sixth and eighth grade math.

So how I got into teaching is a story for another day.

It was completely by accident.

But I think early on, what I realized was that the work that teachers do is so critical, but it is so hard to do when you have students who are missing class.

It represented a turning point for me, Smith told Crunchbase, about how we support as a school system, families and students with evidence-based intervention at scale.

At the time, in 2016, Joanna Smith was a 25-year-old graduate student at the Harvard Extension School.

She made it her mission to use technology to build an attendance intervention support system and revolutionize school-to-family communication.

The result was All Here, an EdTech mission-driven startup launched in 2018 with $5,000 from Joanna's savings.

All Here was further developed at Harvard's Innovation Lab Startup Incubator.

Joanna Smith was introduced to Venture Capitalist and quickly learned the lingo.

Leading and

scaling an impact-focused venture, they're very hard to scale.

As a means to scale, how do we solve this problem at scale?

Help schools scale.

What growing and launching and scaling

a company with impact at the forefront could do to resolve those challenges at scale.

A few school districts interested in scaling their attendance intervention support systems included Miami-Dade County Public Schools, Atlanta Public Schools, Lansing School District, the Louisiana Department of Education, and later, of course, LAUSD.

The results of All Here's solutions were impressive.

A 17% increase in class attendance, a 38% decrease in course failure, and a 0.23 increase in grade point averages.

As if those numbers weren't enough to ensure All Hear a lucrative future.

Here comes a global pandemic in 2020 to force the adoption of virtual learning.

That year, All Here's reach exploded from 1,100 schools to over 8,000 schools across 34 states, serving nearly 4 million students and generating $2 in revenue per student.

The venture capitalists took notice, investing more than $12 million into the company.

What if I told you that 3 million students' families have already been using this to access mission-critical help for school?

That is what All Here is.

My name is Joanna Smith.

I'm CEO of

All Here.

We got started as a spin-out from the Harvard Innovation Labs back in 2018.

Joanna Smith was a technological pioneer.

That's not just me saying that.

That's the name of the award given to her by the World Economic Forum.

All Here was also named the top ed tech product of 2023 by the District Administration Awards, and Time magazine listed it as one of the world's top ed tech companies in 2024.

Joanna Smith was invited to speak at conferences such as the Global Silicon Valley Summit and South by Southwest.

Inc.

Magazine listed her as one of the top female founders of 2024, and Forbes honored her with a placement on its illustrious 30 under 30 roster.

Am I living my American dream?

I would say

yes.

Unfortunately, much like the American Dream, Joanna Smith's accomplishments were based on on complete and utter lies.

Back in late 2020, when All Here was raising capital during its Series A funding round, Joanna Smith, who maintained complete control of the company and its finances, reported to potential investors that All Here's annual recurring revenues were growing 100% year over year.

For example, for fiscal year 2018, Smith reported that the company had 11 customers and $890,000 in revenue.

Fiscal year 2019 showed 35 customers with $1.76 million in revenue.

For FY 2020, she reported that they were on pace to generate $3.7 million from 92 customers.

For FY24, Joanna projected 720 customers with $57 million in annual revenue.

Incredible growth, but not even remotely accurate.

The truth was that in its two full years of operation, All Here had generated approximately $11,000 in revenue.

Total, the company never had more than 31 customers at any single time, which was less than a third of what she had told investors.

In financial statements, Joanna claimed All Here had $2.5 million in cash on hand at the end of 2020.

In reality, there was less than $500,000.

Furthermore, most of the school districts listed as current customers in All Here's pitch deck had never heard of the company.

Lucky for Joanna, none of the investors bothered to perform due diligence before handing her checks for millions of dollars.

She even sold some of her own company shares to those Series A investors and used the proceeds to fund her extravagant wedding and make a down payment on a house in North Carolina.

And when the opportunity presented itself, Joanna Smith, now Joanna Smith Griffin, collected even more.

We begin with the second largest bank failure in U.S.

history.

Several regional banks have halted trading today when their stock value tumbled.

That was all started with Silicon Valley Bank's failure last week.

On March 10th, 2023, Silicon Valley Bank disclosed that it had taken a massive loss on the sale of long-term securities due to rising interest rates.

This led to a run on the bank, which led to a plunging stock price, which led to insolvency and ultimately seizure by regulators.

It was the most significant American bank failure since the 2008 financial crisis.

As luck would have it, Silicon Valley Bank is where All Here Education Education Incorporated held its cash reserves.

In an email dated March 12, 2023, Joanna Smith-Griffin alerted All Here's Board of Directors that 100% of its cash, amounting to about $10 million, was currently unobtainable.

She requested an emergency bridge loan to meet the company's obligations, including its $321,000 monthly payroll.

Two investors who sat on All Here's board loaned $250,000 each.

Once again, Joanna had used fabricated numbers.

All here only had $1.7 million cash on hand, not $10 million, and its payroll costs never exceeded $50,000 a month.

But Joanna knew the company would be raising additional capital that summer based on more fraudulent projections.

She would have no problem paying the investors back.

Of course, this couldn't go on forever.

But it's still shocking how quickly and easily everything fell apart.

In the spring of 2024, Joanna Smith Griffin was late sending the quarter one financial reports to investors, so one of those investors requested the information directly from All Hear's accounting firm.

A representative from that accounting firm provided the reports to the investor, even though Smith Griffin had instructed them not to do so.

Those reports showed earnings of only $442,000 for the quarter, about $2.5 million less than what Smith Griffin previously reported.

This discrepancy resulted in a video conference on June 10th, 2024 between the board of directors and all here's outside financial consultant.

During that meeting, one of the directors received an email from that consultant with an updated report showing revenue of almost $21 million a year.

Thanks for your email, the director told them.

Wait, what email?

The consultant asked.

The one you just sent with the spreadsheet from your all-here email account.

I...

don't have an all-here email account.

It didn't take long for All Here's board of directors to figure out what was happening.

Joanna Smith Griffin had created an email account in her financial consultant's name and was using it to communicate with their staff and investors.

The board promptly removed her from the CEO position and launched an internal investigation in the following days.

It was discovered that Joanna Smith Griffin had transferred at least $600,000 in corporate funds to her personal bank account using PayPal or Zelle transactions, usually under $10,000 at a time, to avoid scrutiny, sometimes attributed to the names of other people.

The investigation also laid bare that All Here was not nearly as profitable as it claimed to be.

As a result, the majority of its employees were furloughed that June, and the company filed for Chapter 7 bankruptcy that August, just one month after LAUSD had unveiled its $6 million All Here created educational chatbot.

Joanna Smith Griffin is accused of receiving nearly $10 million from investors and using the money to buy a house and pay for her wedding.

On November 19th, 2024, 33-year-old Joanna Smith Griffin was arrested at her home in Raleigh, North Carolina and charged with securities fraud, wire fraud, and identity theft.

If convicted, she could spend more than 40 years in prison.

U.S.

Attorney Damian Williams said in a release that Smith Griffin orchestrated a deliberate and calculated scheme to deceive investors in All Hear Education Incorporated, inflating the company's financials to secure millions of dollars under false pretenses.

Oddly enough, U.S.

Attorney Damian Williams released a similar statement about another Forbes 30-under-30 alumnus who headed an education-based startup about a year and a half earlier.

Charlie Javese, just like Joanna Smith Griffin, was accused of fabricating numbers to achieve desired results.

And just like Smith Griffin, any misconceptions about Javis's company could have been avoided with a little due diligence.

A young female founder sells her company to the largest bank in the world on this episode of Swindled.

They bribed government officials to hide accounting for clear violations of the A state law earlierly unethical.

Dummied up its books and records to hide that.

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So I stand here extremely grateful, lucky, and truly, really humbled

before you today to have this opportunity to share my dream and passion to end poverty.

So everyone sort of asks me, how in the world are you going to do this?

And what crazy parents did you have that makes you think you can?

In April 2012, Peter Teal, the billionaire technology entrepreneur and enemy of democracy, invited 50 young entrepreneurs to San Francisco to compete for a $100,000 Teal Fellowship.

The purpose of the program, which was founded a year earlier, was to encourage young people to drop out of college to build new things now.

Why wait?

All of the finalists already had ideas to pitch to the Teal Foundation's network of business owners, investors, and scientists.

CNBC documented the competition in a two-part special.

One of them is Charlie, a 19-year-old Ivy Leaguer.

One of those finalists was 19-year-old Charlie Javis.

She had co-founded a non-profit startup with her younger brother in 2010.

Her experience volunteering had really opened her eyes to the fact that charity, quote, wasn't necessarily working.

For example, Charlie said she spent a summer teaching English in Thailand and realized that the people didn't need English.

They needed food.

They needed water.

They needed opportunity and a sustainable income source to lift them up out of poverty, teach a man to fish and all that.

And when you're thinking about kind of any version of change or upward mobility in someone's life, you want to create opportunities for them to be the ones serving and giving back and kind of moving up, but that wasn't happening.

Charlie continued to brood over that experience at college.

The ambitious teenager graduated high school early and was accepted into the University of Pennsylvania's Wharton School of Business.

Even while taking a full course load, involving herself in Jewish campus organizations, working in an internship at a French microfinance NGO, and checking off every other imaginable box on a resume, Charlie developed an idea to revolutionize philanthropy.

It was called Pover Up, a quote, microfinance, social business, investment and research platform that aims to unite the work of scholars, the drive of students, and experience of professionals to learn, connect, and invest in market-based solutions.

In other words, Pover Up was a web platform that would allow students to make micro loans of as little as $5 to small global businesses.

A small transaction fee would cover the company's expenses.

Together, the grassroots effort would, quote, end poverty with the click of a mouse.

Pover Up is an online community that allows students, scholars, and professionals to learn, connect, and invest in market-based solutions to alleviate poverty.

Armed with this idea, Charlie Javies became the youngest member and first freshman ever to be accepted into the Wharton Venture Initiative program, one of the country's most selective on-campus entrepreneurship programs.

She networked with advertising agencies, public relations companies, and microfinance institutions.

She attended and spoke at conferences like the University of Chicago Booths Microfinance Conference and Microfinance USA.

Charlie Javies was making a name for herself.

Less than a year after founding Pover Up, Inc.

magazine named the nonprofit one of America's coolest college startups.

Fast Company named Charlie one of 2011's most creative people in business.

We didn't want a 50-year-old white guy telling us what we're interested in, she told the magazine.

Charlie Javies was quite the boundary pusher, but that confidence was alluring.

and necessary in a microfinance space where she was often the only woman surrounded by other micro things.

And her age and name never made it easier.

My name is Charlie, not Charlotte, she told Business Insider.

That's always surprising to people when I walk into meetings because they're often expecting a man.

What people would come to expect was a brilliant and driven young woman who had no issue in paving her own way.

Charlie Javis was in a league of her own.

and that self-assuredness was on full display in that CNBC Teal Fellowship competition show.

On the first day of filming, while the other contestants worked together to solve a scavenger hunt, Charlie grabbed a coffee and went shopping.

During the pitch competition, Charlie not only ignored the directions to stand at the podium, but her microphone was cut off because she exceeded the allotted time.

Not that it mattered.

Charlie said she was selected to be a Teal Fellow, but turned down the opportunity.

because she did not want to forego a degree or limit her education.

If I were to drop out, I know I'd be doing power up 100%.

I would not be thinking about auction theory, she told the camera.

Besides, she concluded, there's nothing Peter Teal could do for her that she couldn't do for herself.

I even try to explain the fellowship, and I'm like, wait a second, what crazy person would take this?

Two years, is it really worth $100,000?

Like, really?

I've made a network that's if not comparable, if not better, than what Teal is to offer me only in Silicon Valley.

Like, charlie why would you take this charlie's version of events has been disputed patrick gibson the vice president for grants at the teal foundation at the time later told fortune magazine that charlie was never selected to be a teal fellow in fact quote we emphatically rejected her the footage aired on cnbc which shows no offer being made to charlie seems to back up that claim.

She's supposedly been on this project for two or three years.

She has a landing page.

I don't know what she's actually done.

That was true.

By the time Charlie Javis graduated from Wharton in 2014, Pover Up, despite gaining some national attention, had never become much more than a landing page.

By 2016, Charlie abandoned the project altogether.

She had an even better idea.

It was called Tapped.

T-A-P-D.

Initially, Tapped was a job search website that Charlie co-founded with an Israeli entrepreneur named Adi Omasi, who would serve as the company's chief technology officer.

But before it even launched, the project evolved into something else entirely.

Instead, Charlie aimed to create an alternative to the FICO credit score, one that was more fair to students and low-income consumers.

Dumb, blind monkeys could do a better job of credit scoring than banks do, Javiz told TechCrunch.

Investors agreed and pumped $10 million of seed money into the venture.

However, Charlie soon ran into an insurmountable roadblock.

Little did I know there that there was this whole body of regulation called the CRA that would require you to basically incorporate as a credit rating agency or a credit bureau in 50 states, which would be millions of dollars a year in compliance.

So that was a no-go.

Charlie returned the investors' money and fired all her employees.

It was the worst thing I've ever had to do, she told Superwarm.

A lot of my employees were close friends and still won't talk with me to this day.

Taft was abandoned in June 2016, and it was back to the drawing board for 24-year-old Charlie Javies.

But she was on the right track.

So having grandparents who escaped the Holocaust, the one thing they've always taught me is that education is the one thing you could take with you.

And with that, it's also the biggest and greatest gift you could give to someone to pay it forward.

Education was the answer, but the problem for many people in America was, how do you pay for it?

Charlie remembered her experience applying for financial aid and how tedious and frustrating it was for everyone involved, including her parents who were, by all accounts, intelligent people.

Didier Javis, Charlie's father, a French national, had worked at hedge funds and investment banks for most of his career.

while Charlie's mother, Natalie Rosen, had a master's degree in education and taught at the French American School of New York, the expensive private school that Charlie and their little brother attended.

The Javisas were doing all right financially, sure.

Charlie rode horses as a kid and spent summers abroad in Israel and Paris, but they weren't nearly as affluent as their Westchester, New York neighbors.

Plus, her parents were divorced.

Financial aid was not out of the question.

Having been through financial aid myself and knowing that 90% of students depend on financial aid to get through college, it's a really, really big deal.

Financial aid is a really big deal and according to Charlie, needlessly complicated.

She said she even considered moving to Canada because A, university was cheaper and B, because appealing the financial aid package she was offered took almost an entire semester to resolve.

Charlie couldn't imagine how much other people struggled with the process.

Most people didn't even know that you could appeal the financial aid amounts you were offered.

It's crazy, like when I went to Penn, I think my parents might have spent like like at least four months rejecting every single answer.

And they just ended up getting more and more and more money, which was great.

But that took a lot of knowledge and a lot of research.

It was probably upwards of 50 hours, and they had never done this before.

I spent a lot of time on the banking side trying to figure out how to lend money in a more responsible way and have banks give a shit, Javis said.

It always came back to the one thing, which was there was no ally for students.

Charlie Javis wanted to be that ally.

And I think at the end of the day, what really mattered was the student and the fact that no one's advocating for them, or that they don't really have an ally in this financial aid process.

Banks are out there and they're lending because it makes them a profit.

Then universities are out there kind of like filling airplane seats where it's yield management.

And then the government is subsidizing this whole thing and no one's really necessarily asking questions.

Using the same LLC that she used for Tapped and the same same CTO, Audi Omacy, Charlie launched a new digital platform in 2017 that would assist students in applying for financial aid.

It was called FRANK.

Its mission to make quality education affordable to all.

How?

By beginning at the same intimidating place where every prospective college student in America finds themselves, the FAFSA.

So other than a tongue twister, it stands for the free application for federal student aid.

And so this one form unlocks all of your financial aid.

FAFSA, or the free application for federal student aid, is a form that was introduced in 1992.

Most students encounter it for the first time during their senior year of high school, but it's prepared annually by everyone applying for financial aid.

This one application is solely responsible for determining how much money is awarded through grants or loans.

At the time, FAFSA's 100-plus questions could take hours to complete, especially for those unfamiliar with certain terms or who come from families that have complicated assets.

It's a government form, and that means that it's extremely painful.

If you read it, it looks like a tax return and a legal prenup put together all in one.

According to Charlie Javies, almost half of the people who start filling out their FAFSA never complete it because of its real or perceived complexity.

In essence, billions of dollars are being left on the table.

Charlie created Frank to change that.

Frank would streamline and simplify the process by tailoring the form to the individual applicant, automating up to 70% of the questions.

The service would also calculate all the tax math inside the app.

We have eliminated layers of bureaucracy, opportunity for mistakes, and hours of headache and heartache, Frank's mission statement read.

Javise claimed that her platform had reduced the time to complete a FAFSA from 13 hours to four minutes.

It was revolutionary.

Getting financial aid might might seem really, really complicated, but at Frank, we've really simplified it for you.

We found a technology solution to make it simpler, kind of like TurboTax when you file your taxes.

Like TurboTax, Frank's basic offerings were completely free.

However, there were premium services available for a fee, including a $20 monthly membership that granted access to end-to-end financial support.

throughout a student's higher education experience, as well as the option to accept a $5,000 interest-free cash advance from Frank to cover tuition and other costs while waiting for the financial aid application process to complete.

It takes you only four minutes and potentially $30,000 that you could have in your pocket, so file FAFSA with Frank starting October 1st.

Frank was such a good idea.

It was hard to believe that no one tried to make the FAFSA process more efficient before Charlie Javies.

There was a reason for that, Charlie explained.

The types of privileged people who would create and fund such a venture had no experience applying for financial aid themselves.

You have a lot of investors that are typically white men over the age of 50 that are trying to understand a problem they have yet to face.

I started Frank not as a policy fuck you, Charlie told Vast Company.

She started Frank to build a more inclusive world by helping millions of lower-income households pay for college, by opening the door to assistance they previously could not easily access on their own.

Cash flow is the main issue most students face, Javis continued.

To show you how dire the problem is, she said.

One-third of students are applying for high-interest payday loans.

Not anymore.

Doesn't matter who you are.

This applies to really most of America, which is why this topic is so exciting, but it's also why it's one of the systematic challenges that we have for our economy and facing families today in the realms of personal finance.

This sounds great and all, but why is it called Frank?

So, when you sit down and ask people who they turn to for financial advice, what do they usually say?

So for the demographic between 18 and 26, which was our main demographic and also one that I'm a part of, it's always some crazy uncle.

Frank seemed to be really fitting for that.

We wanted something to be super approachable, very friendly, somebody that can also speak with authority.

And in the student debt world, there's a lot of corruption, a lot of squeamish things that are happening.

And we wanted it to stand for honesty.

With the support of $5.5 million in seed capital from all FBC, frankthafsa.com launched on March 29th, 2017.

It was an instant success.

You know, we're really excited.

We think we have a good thing going.

And we think families, and we've seen it, we have more demand than we're able to handle.

And so we're staffing up.

And it's wonderful to see a company grow from a strong foundation.

And I think when you do something that has, you know, is mission positive, you do end up making a business out of it.

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College is important, even for a professional athlete.

I got to college thanks to financial aid.

You can too.

The Pistons are partnering with an organization called Frank to help you file FAFSA and get financial aid for college.

In less than two months, by Charlie Javis's calculations, Frank had helped over 60,000 families unlock more than $1.5 billion in federal aid.

In less than two years, those numbers quintupled to seven and a half billion dollars awarded to more than 300,000 students.

Wait, is that number correct?

That number is correct.

We have helped seven, or sorry, 300,000 students about

get access to financial aid by filing FAFSA with us.

An average FAFSA award is about $28,000 and therefore you multiply the $28,000 by the $300,000 and it gets you to $7 billion.

Of those 300,000 students, 68% were reportedly women.

Nearly half were first-generation college students.

A large percentage were veterans.

Frank was helping the exact demographic it intended to help.

You could actually see photos of some of Frank's happy customers on its website, such as smilingmaturewoman.jpg and good looking cheerfulmanager.png.

Not pictured, however, was angry department of education officials.tiff.

In 2018, they had sent Frank a cease and desist over the domain name frankfafsa.com.

The DOE owns the trademark to the FAFSA acronym and alleged that the name could mislead applicants looking for the official FAFSA website.

Frank complied by changing its domain name to withfrank.org and disclosing that it was not affiliated with the federal government in any way.

Later, the U.S.

Federal Trade Commission found issues of its own with Frank.

In some cases, the agency alleged the company's purported assistance to students in accessing grant monies consisted of nothing more than a form letter that was sent to university staff.

We are concerned that Frank is creating false hope and confusion for students while contributing to unnecessary extra work for financial aid administrators.

Even worse, it was discovered that Frank's $5,000 interest-free cash advance was a bit more predatory than it portrayed itself to be.

A look at the fine print revealed that the loan was required to be paid back in 60 days or else interest and fees would apply.

Not a great look.

Neither was the lawsuit filed against Charlie Javis and Frank in 2017 by Audi Omicy for unpaid wages.

The company's former chief technology officer claimed he was never awarded the 10% equity in Frank that he was promised upon joining.

Omissy was eventually compensated $35,000 per a Tel Aviv court order.

And reportedly, he wasn't the only employee that hadn't been paid.

According to Forbes, there were rumors that Javis had stopped paying the staff of her earlier companies, which is why they refused to talk to her, as she mentioned in later interviews.

In other conversations, Charlie admitted that, at a certain point, her company was operating, quote, $500,000 in the red, and she had to figure out how to pay people.

Or maybe she didn't.

The truth, as Charlie Javis would have you believe, is that she didn't care about the money.

I'm not among the top five paid people at my company, she revealed to Business Insider.

No, Charlie was more obsessed with the aesthetics of being the CEO of a tech company than the fortune it provided.

And by most accounts, she wasn't a bad boss, but she was probably challenging to work for.

There's no such thing as work-life balance, Javi said in an interview about leadership tactics.

I would never hire anyone who asked me that about our company.

That's right, Charlie had a non-stop motor and led by example.

In that same Business Insider article, the young CEO described her typical day.

She started her morning with a run on the boardwalk and Pilates class.

She'll often take a mid-afternoon screen break to quote, go out into the wild to ask random people about their student loans.

Her day often ended with sunset yoga and a swim, she said.

Wow, CEOs, truly a different breed.

Hi, I'm Charlie Javies.

I'm the founder and CEO of Frank.

Our company helps students pay for college, and we do that by connecting them with all of the types of aid available, which includes scholarships, loans, grants, and all the above.

All that hard work was paying off, though.

Charlie DeVise became a familiar face in the media.

She appeared on CNBC and other news stations numerous times to promote her company.

She sat down for various podcast interviews.

She presented at a variety of conferences.

She wrote opinion pieces and articles for the Wall Street Journal, the New York Times, and more.

Charlie became the resident expert in financial aid.

But don't worry, worry, we have someone here that can help us with everything that we need to know.

Let us introduce you to Charlie

Janfeest, founder and CEO with withfrank.org.

Charlie Janfeist was wise beyond her years, no doubt.

Care to share anything you've learned along the way on your meteoric rise to success.

The other fun piece of advice is you should promise me you'll do these three things every day.

And I said, what are they?

He said, no, you have to promise.

I said, okay, I'm really scared now.

And his answer was, exercise, meditate, and you guys can get really creative with the third one.

Exercise, meditate, and curse God for your existence?

No.

Just me, I guess.

All right.

Sex.

The answer was sex.

Charlie repeated the uncensored version of that advice in a different interview.

Noted, is there any other sage wisdom for which a mid-20s Ivy League educated startup founder born with an extensive safety net can bless us?

The other thing

I would say is like don't be patient.

So everyone kind of calls patience a virtue and if I had waited for the time or the right time or you know getting the right answers then nothing would ever get done.

And so I think you know don't be patient.

Do the exact opposite of what everybody else tries to tell you to do,

and you'll get there a lot faster.

Yeah, we know.

Move fast and break things.

The same tired mantra shared by every asshole with an idea for a phone app.

Apparently that's all one needs to say to get a glowing profile as a savvy entrepreneur in a financial magazine.

Why are we listening to these people again?

Well, as Catherine Long and Jack Newsham later wrote for Insider, another publication guilty of featuring Charlie Jafiz early in her career, this kind of publicity creates a feedback loop.

Quote, Javis was important because she appeared in major news outlets, and major news outlets covered her because she was important.

Fair enough.

By 2020, the 27-year-old Frank founder had an office on Madison Avenue in New York City where she managed 18 full-time employees.

Crane's New York business had named Charlie Javies to its 2019 roster of 40 under 40 rising stars.

That same year, Forbes included Javis on its 30 under 30 list.

What did all of this notoriety equate to for Frank?

About $20.5 million in venture capital through three rounds of funding.

The very early seed round was not many people believed that we could scale.

So obviously we then proved him wrong, but like trying to convince people who didn't believe or couldn't see how we would go to market that obviously is challenging at that point in time.

Charlie Javis used the investor money to expand Frank's product line.

At the end of 2020, the company launched ClassFinder, a partnership with colleges nationwide to offer users the unfilled slots in its online classes at a discount.

More credits without extra debt.

Just another way Frank was looking out for the little guy.

And we came up with ClassFinder and partnered with hundreds of universities in the U.S.

to be able to offer their courses at a steep discount to their usual prices.

However, many of the colleges listed on Frank's ClassFinder website had no knowledge of their inclusion.

Kaiser University in Florida, for example, told the New York Times that the school had no relationship with the company.

Quote, We have never been engaged in tuition sharing with Frank, nor has the university received revenue from the organization.

Lee University, a Christian college in Tennessee, was also surprised to learn that its 317 online courses were being offered on Frank, especially since only 248 online courses existed.

Whatever, let's not get lost in the numbers.

And so we turned that process from, I think the Gates Foundation said 13 hours down to less than five minutes.

And now we serve over 4 million students who turn to us and trust us for financial advice and guidance.

In January 2021, Charlie Javies wanted to strike while the iron was hot, as they say.

Frank was more popular than ever, so she enlisted Lion Tree Advisors, an investment bank, to navigate the company's potential sale to a larger entity.

In preparation for a meeting with Lion Tree, Charlie sent a simple request to Frank's digital team.

The reporting metric for counting users has changed, she informed them.

Please alter the over 300,000 students figure on the homepage, which had been the public-facing number for two years, to read over 4.25 million students.

LOL, are these your numbers?

A Frank employee later asked a cohort in a Slack message on January 11th, 2021.

Of course not, haha, the co-worker responded.

These look like Charlie numbers.

Charlie is the king of finding magic numbers.

It's been suggested that Charlie decided to treat and report website visitors as Frank users, regardless of whether they had created an account.

But even if that were the case, 4.25 million would still be overly optimistic.

The New York Times reported that the Frank website received around 67,000 unique visitors per month.

Multiply that by the total months of the company's existence, and it would still be more than a million visits short.

So, you know, being a founder, I'm obviously skewed towards being overly optimistic.

And sometimes that works to your advantage,

sometimes it doesn't.

And, you know, there were definitely times where I painted a rosier picture than things truly were

because I did believe that because I'm just an optimistic person.

Liontree, already negotiating with a potential buyer, pushed back on that 4 million figure.

Is that unique visitors or impressions?

They asked Charlie to clarify.

Whoops, it's impressions from Google, she responded.

Just mislabeled.

Don't worry about it.

Charlie said she didn't want to change numbers around so soon before the presentation.

Liontree, however, insisted that she be upfront and direct about it with the potential buyer.

Charlie begrudgingly relented.

And less than 24 hours after receiving the correct information, that unnamed bidder pulled out of the deal.

But not all hope was lost.

A few months later, Frank had a new suitor.

One of the company's largest investors put Frank on the radar of JPMorgan Chase.

They're getting interest from prospective buyers, the email read.

JPMC should have a look.

It was actually perfect timing.

JP Morgan Chase, the world's biggest bank, desperately wanted to grow its share of Gen Z customers.

Since 2020, the bank had been on a spree of buying or investing in every fintech company they could find.

Chase was trying to compete with companies like Cash App and QIIME, which had become much more attractive to a younger demographic.

It made too much sense not to pursue.

JPMC's head of corporate development, Leslie Wilms-Morris, said she'd be happy to meet with Charlie.

That meeting went well, and four months later, in July 2021, serious talks began about a potential acquisition.

Over the next several weeks, as it does for every merger and acquisition, JPMorgan Chase conducted its routine due diligence on Frank, or Project Finland, as it was known internally.

Leslie Williams Morris led the process, and nearly 350 people from nearly every bank department were involved.

Corporate development, product, consumer, technology, finance, compliance, legal, outside counsel, risk, and controls.

Of course, this process also required multiple rounds and hours of meetings, conference calls, and live product demos with representatives from Frank, namely Charlie Javis, who did most of the talking.

Naturally, the topic of how many customers Frank served came up, and in both oral and written statements, no fewer than seven times, Charlie claimed Frank had more than four and a quarter million customers.

And counting, she told the bank that her company was on pace to more than double its users to nearly 10 million by the end of the year.

So I guess one, in terms of growth, we're reaching close to 5 million households.

This year, we're going to be doing probably 8 to 10 million households in the U.S.

To clarify, Charlie specifically defined a user in those meetings as an individual who provided Frank with their name, email, address, and phone number, not to be confused with website visitors, which Charlie claimed amounted to more than 35 million since 2017.

JPMorgan Chase was impressed, quote, very, very impressed.

Frank was precisely what the bank needed.

Access to millions of young, lower-income banking customers that they could exploit for many years to come.

Can you send us more data on Frank's customers?

Williams Morris requested on August 1st, 2021.

Uh, not really, Charlie responded, or something to that effect.

Providing that information would violate numerous privacy laws and federal regulations.

Oh, come on, J.P.

Morgan playfully nudged in this imagined reenactment.

What if, the bank suggested, you send us the data, but replace any sensitive information with unique IDs?

That way, we can still use a third-party data management vendor to validate the information's authenticity while avoiding any privacy issues.

Fine, Charlie agreed, but give me a few days.

Charlie immediately picked up the phone and called Frank's director of engineering, Patrick Vavour.

Yeah, so how easy would it be to take a user base of about 300,000 and grow it to 4 million users?

You know what?

Don't answer that, but read the article I just emailed you about creating synthetic data, and we'll meet tomorrow.

The next day, Charlie Javis and Frank's head of growth, Olivier Amar, met with the engineer Patrick Vavour over Zoom.

The two Frank executives asked Vevor to create data for 4 million non-existent users.

Is this even legal?

The engineer asked.

Yes, it's legal, Javis responded in his native French.

We don't intend to end up in an orange jumpsuit.

Patrick Vavour politely declined to participate, which sent Javis and Amar scrambling.

Think, Charlie, think.

Oh shit.

What about Adam?

Adam Kapellner was a data science professor at Queens College.

He graduated from Stanford and earned a PhD in statistics at Wharton, where he met Charlie Javis.

He had built models for hedge funds.

Surely he could pull this off.

Charlie texted him.

I'm in an urgent pinch and wondering if you still do consulting work and have some time, she wrote.

Adam responded that he did, and his hourly rate was $300.

I'll double it, Javis responded.

They scheduled a Zoom meeting for the following day.

During that meeting, which took place at 2.15 p.m.

on August 3rd, 2021, Charlie sent Adam a spreadsheet that contained 293,192 entries.

She described how she wanted to use the existing data as a seed to simulate about 4 million more records.

Names, emails, birthdays, everything.

Adam Kapellner signed a non-disclosure agreement later that day.

What's this even for?

He asked later.

I can't tell you, Charlie replied.

Confidential.

That afternoon, Frank's head of growth, Olivier Amar, texted Charlie asking how the meeting went.

I found my genius, she replied.

He says it will take an hour.

The process actually took a couple of days.

Adam tested the synthetic names to make sure they weren't real.

He ran into an issue creating believable addresses.

I just wouldn't want the street to not exist in the state, Charlie advised.

The emails looked obviously fake too, so they decided to use unique IDs in the meantime.

And the phone numbers.

Adam found the same phone number appeared for 676 different individuals in the original data.

Turns out it belonged to a Frank employee whose job it was to test the website.

Fuck it, leave it, Charlie instructed.

We need to get this done.

After 22 hours over three days, Adam Compellner delivered.

He sent Charlie an invoice for $13,300 that included an itemized list of tasks completed, including quote, college major generation, zip codes, etc.

Charlie replied, Can you send a new invoice but just list the service as data analysis?

You can change the build amount to $18,000 when you do.

Adam did as instructed, and on August 5th, 2021, he uploaded the data file containing 4,265,085 rows to Axiom, the third-party data company tasked by J.P.

Morgan, to validate the information.

Axiom offered to verify the entries using a reverse phone number lookup, which would link numbers to names and addresses.

JPMorgan declined.

Axiom sent the validation report to Charlie DeVise.

Everything checked out.

All good?

Leslie Wilms-Morris asked in the text.

Exact count match as expected, Javese replied.

I wasn't worried.

Smiley face.

Three days later, on August 8th, 2021, J.P.

Morgan Chase agreed to acquire Frank for $175 million, or about $45 per user.

It was actually a bargain.

Think about it.

If the lifetime value of a customer were $10,000, The bank would need to convert less than 1% of Frank's young users to recoup the acquisition cost.

A checking account could lead to a credit credit card and then maybe an auto loan, hopefully a mortgage.

Frank would pay for itself in no time.

The acquisition was approved at every level of JP Morgan, including its billionaire CEO Jamie Dimon, who had taken a personal interest in the proposition.

Diamond had reportedly told Javies back in July that he thought they would be able to get the deal done, and they did.

JPMorgan Chase's acquisition of Frank was finalized on September 14th, 2021.

Jamie Dimon declared last year he planned to get more aggressive in seeking takeovers, and he certainly made good on that promise with JPMorgan buying another financial startup, this time it's college financial planning platform, Frank.

Today is my first day employed by someone else ever, Charlie DeVies told CNBC.

It's a fantastic place to be, and I couldn't find a better and bigger platform to accelerate our impact.

I mean, it still feels very much like pinch me.

Did this really happen?

Charlie would remain the CEO of Frank, but she also became the head of student solutions at JPMorgan, making her the youngest managing director in the organization.

Charlie received more than $9.7 million in stock proceeds and millions more indirectly through trusts.

Her contract also entitled her to a $20 million retention bonus, provided she remained employed by the bank for three years or was terminated without cause.

15 other Frank employees were brought to JPMorgan as part of the acquisition, including Frank's head of growth, Olivier Amar.

He received $5 million in proceeds from the merger and a $3 million retention bonus.

Charlie remained his boss.

Kept my self-evaluation brief, as you requested, Amar texted her a month after the acquisition.

My comment, Javice replied, is you're the best partner in crime.

The end.

Smiley face.

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So it's funny because when I told my mom the news,

she said, Of course, JP Morgan bought Frank.

You said you would, you know, they would be your number one when you started the company.

And what, you know, really attracted me, honestly, was the people.

I started this company, and one of my favorite parts of the job is working with amazing people from all different backgrounds.

And what was truly amazing was the leadership to daily managers.

Everyone just had such different perspectives.

You know, I probably met one or two men in the process.

The bank is run by two really fantastic women, and a lot of the leadership is just so inspiring.

Charlie DeVies and Olivier Amar knew this day would come, the day when J.P.

Morgan Chase would attempt to utilize the data Frank fabricated during the acquisition.

In January 2022, Chase's marketing department asked Frank to send over its list of 4 plus million customers.

They were planning to run a little email campaign to test it out.

Charlie Javis and Olivier Amar had prepared for this.

While Javis was working with Adam Kapellner to create the synthetic data that was ultimately used to seal the deal, Amar had reached out to a company called ASL Marketing, which claimed to have comprehensive and accurate data on millions of high school and college students.

Olivier organized the purchase of data for 4.5 million students from ASL at a cost of $105,000.

However, that data arrived too late to use during the acquisition process, but Frank still had access to it.

They planned to provide the ASL data to Chase's marketing team for the email campaign.

Once again, Charlie enlisted Adam Kapellner to help.

She instructed him to work with another data company called Informian to obtain additional phone numbers and email addresses and append them to the ASL data.

Finally, three weeks after the initial request, Frank provided its customer lists to Chase's marketing team.

Days later, an email was sent out to a random sample of 400,000 unique Frank users with offers to open checking or savings accounts.

The results, in one word, disastrous.

72% of the emails bounced back as undeliverable.

That number was closer to 1% for a typical Chase marketing campaign.

Of the emails that were actually delivered, a little more than 1% were opened compared to the typical 30%.

Of those emails that were opened, only 103 clicked through to Frank's website.

Chase's marketing team had never seen anything like it, but they knew shit when they saw it, and Frank's customer data was unquestionably shit.

That summer, the bank quietly launched a comprehensive investigation into its latest acquisition.

It didn't take long to find the smoking gun.

Charlie Javis and Olivier Amar had organized the creation of fake data using their Frank email, Slack, and WhatsApp accounts, all of which were now owned by J.P.

Morgan Chase.

It was all there.

Invoices, chat logs, meeting notes.

The bank's investigators even found Frank's authentic customer list with less than 300,000 entries.

Charlie Javis and Olivier Amar were placed on administrative leave on September 13, 2022.

Both were quietly fired that November.

It was rumored that J.P.

Morgan Chase wanted to sweep the whole Frank thing under the rug because, quite frankly, it was embarrassing.

Just imagine what kind of blight that would leave on the world's largest bank's otherwise sterling reputation.

The nation's biggest bank is facing a $13 billion fine this morning for its role in the mortgage meltdown.

Nevada's Attorney General announces a $136 million credit card debt collection settlement with J.P.

Morgan Chase.

Nevada, along with 46 other states, made a deal following an investigation into the bank's past debt collection practices.

JPMorgan settling a bribery case involving hiring in China for $264 million.

JPMorgan Chase, the nation's biggest bank by some measures, agreed to pay $410 million to federal energy regulators to settle charges that its traders manipulated electricity markets in California and the Middle West.

J.P.

Morgan Chase has to pay $920 million as part of an agreement with financial regulators and the Department of Justice.

The fine settles charges relating to a group of traders at the company who manipulated the market for precious metals and U.S.

treasuries over an eight-year period.

U.S.

Bank J.P.

Morgan Chase is to pay more than $2 billion in penalties over Bernie Madoff's Ponzi scheme.

That's to settle charges by U.S.

federal authorities.

The bank failed to report numerous suspicious interactions during the 20 years he had accounts with the bank.

Banking giant J.P.

Morgan Chase agreeing to pay nearly $300 million to victims of accused and now deceased sex trafficker Jeffrey Epstein.

The accusers say the bank ignored repeated warnings about Epstein, thereby allowing him to continue abusing girls and young women, all because he was a valuable client.

Charlie Javis refused to go quietly into the night, however.

Both she and Olivia Amar filed a civil suit against J.P.

Morgan on December 20th, 2022.

claiming they were owed millions in compensation and legal fees.

The bank responded two days later with its own civil suit against Javis and Amar, alleging that the duo committed fraud by fabricating around 4 million non-existent accounts to show that Frank was a successful, growing business.

Javis then hired attorney Alex Spyro, who had notably defended Elon Musk, Eric Adams, and Alec Baldwin in recent years.

With Spyro's help, Javis filed answers to Chase's lawsuit, in which she claimed the bank was in a rush to close the deal and did not conduct adequate due diligence because it had competition from other banks in acquiring Frank.

How could one of the most powerful and sophisticated companies in the world fall for such an alleged scam?

Javis's lawyer said in the filing.

Javis also claimed that the bank not only knew the data was fake, but requested it.

J.P.

Morgan Chase said in court documents that this allegation was nonsense.

Quote, synthetic data that mimics false data is of no use whatsoever as diligence material or later as marketing material.

Charlie Javis then filed a $28 million countersuit to Chase's countersuit, claiming that she was a whistleblower.

The bank knew exactly what they were buying with Frank, she alleged.

Look no further than the purchase price.

The company had raised $20 million in funding and purportedly owned 25% of the student market.

Why would Chase offer only $175 million when similar companies sold for much more significant amounts?

JPMorgan was just trying to cover their ass, Javise's lawyers alleged.

Recent changes to student privacy laws prevented the bank from conducting marketing campaigns in the way that they were accustomed to, but they did it anyway, so Charlie blew the whistle.

To retaliate, she claims the bank opened a series of groundless investigations against her, to quote, shift the blame for a failed and now regretted acquisition to someone they viewed as an easy target, its young female founder.

The damage wrought by JPMC's falsehoods is likely to be lifelong.

So much for avoiding the embarrassment.

JPMorgan's CEO Jamie Dimon was asked about the Frank acquisition in an earnings call that took place on January 13th, 2023.

He admitted that it was a huge mistake.

And obviously there are always lessons learned.

And at one point, we'll tell you the lessons learned here when this thing is out of litigation.

But we're quite comfortable.

And the people who are responsible are the people in the business.

So if they, you know, if that business did the acquisition, they are responsible.

They report back.

And we expect people when they talk to all of us is the good, the bad, the ugly.

We're never looking for how great everything was.

And obviously, this thing in one way or another was a huge mistake.

On the subject of Jamie Dimon, some recent audio leaked of him addressing Chase employees at an internal town hall meeting.

It doesn't really have anything to do with this story, but it's too good not to share.

And maybe it will sway you if you find yourself feeling sympathetic for such a soulless entity.

At this town hall meeting, Chase employees were given the opportunity to ask the CEO about various topics, such as why raises and bonuses were smaller than expected in a year of record high revenue and profits.

But in this particular clip, Diamond is responding to a question about the bank's recent re-implementation of a five-day in-office requirement.

It's clear that Mr.

Diamond is not a fan of remote work.

A lot of you were on the fucking Zoom

and you were doing the following, okay?

You know, looking at your mail, sending texts to each other over an asshole the other person is.

Okay?

Not paying attention, not not reading your stuff, you know, and if you don't think that slows down efficiency, creativity, creates rudeness, and stuff, it does, okay?

And when I found out that people are doing that, you don't do that at my goddamn meetings.

You go to meeting with me, you got my attention, you got my focus, I don't bring my goddamn phone, I'm not saying text to people, okay?

It simply doesn't work, and it doesn't work for creativity, it slows down decision-making.

And don't give me the shit that work from home Friday works.

I can't stand it anymore.

Now, you have a choice.

You don't have to work at JPMorgan.

So the people of you who don't want to work at the company, that's fine with me.

I'm not mad at you.

Don't be mad at me.

It's a free country.

You can walk with your feet, you know, but this company is going to set our own standards and do it our own way.

And I've had it with this kind of stuff.

And, you know, I come in, you know, I've been working seven days a goddamn week since COVID.

And I come in and where's everybody else?

Wow, Jamie, seven days a week?

You're really earning that $39 million a year salary.

You must be making a lot of Excel spreadsheets or something.

Like, I've never done an Excel spreadsheet.

Oh, of course.

Anyway, let's get back on track.

Charlie Javis and Olivier Amar's legal problems escalated when the Securities and Exchange Commission filed a civil complaint against them on April 4th, 2023.

The allegations were similar to the fraud lawsuit filed by Chase.

The regulator sought to bar Javis from acting as an officer and director of a public company and to repay any ill-gotten gains.

Even more serious, that same day, the Department of Justice filed a criminal complaint against the duo, charging both Javis and Amar with conspiracy and wire securities and bank fraud.

Javis lied directly to JPMC and fabricated data to support those lies, all in order to make over $45 million from the sale of her company, U.S.

Attorney Damian Williams said in a statement.

This arrest should warn entrepreneurs who lie to advance their businesses that their lies will catch up to them.

Federal authorities caught up to Charlie Javis at a New Jersey airport that morning to take her into custody.

Olivier Almar was apprehended three months later.

There's a new woman on the scene, Charlie Javis.

She was a hot shot in the startup world.

You can find her on Forbes 30 under 30 list and all other hip-tech young startup spaces.

She founded a company called Frank, a college financial planning platform.

But according to the SEC, they are now accusing her of, quote, old school fraud.

Students scam students, but scammed the bank.

How in the world does this happen?

How does JP Morgan, right?

One of the biggest, smartest global investment banks out there, somehow not figure this out before they lay down 175 lars?

Charlie was released from jail on a $2 million bond.

She was given a curfew and an ankle monitor and forced to surrender her passport.

Both Javis and Amar vowed to fight the charges.

The first battle was to have JPMorgan Chase pay for their legal fees, as stated in the merger agreement.

Fighting multiple lawsuits at one time was adding up.

Plus, the government had blocked Charlie from accessing the millions of dollars she had moved from her Chase accounts into Shell Company's signature bank, which collapsed one month before her arrest.

Charlie barely avoided disaster.

by transferring the funds just days earlier in response to Silicon Valley Bank's insolvency.

On May 8, 2023, a judge ruled that J.P.

Morgan Chase must pay the legal fees for Javis and Amar to defend themselves against the civil suit, but not for Javis's countersuit.

Javis immediately hired her version of the dream team, a total of 77 attorneys, including Jose Baez, who famously represented Casey Anthony, and Ronald Sullivan, a Harvard law professor who was part of Harvey Weinstein's defense team.

This resulted in a flurry of prolonged pre-trial wrangling.

At one hearing, the court clerk looked around and asked, Is Charlie Javis here?

Obviously, expecting to see a man.

Charlie raised her hand.

The clerk apologized.

It happens a lot, Charlie said with a smile.

J.P.

Morgan pushed for arbitration, filed counterclaims, and demanded that Javis restore her Twitter account and hand over bank property, such as the passwords to Frank's systems and applications.

Charlie's defense team wanted access to chase documents as part of the discovery phase, which they claimed the bank was withholding.

They also urged the judge to remove Charlie's ankle monitor because the, quote, heavy, cumbersome GPS unit caused her physical pain and impeded her new job as a Pilates instructor.

That motion was granted.

Also granted was the defense's motion to bar certain text messages from being seen by the jury, specifically the one about Amar being Javis's partner in crime, and others referencing Elizabeth Holmes, who had been convicted a year earlier of defrauding investors in her blood testing company Theranos by pitching machines that didn't work.

Javis told Amar that she'd hoped Holmes received a light sentencing.

After 11 years was handed down, Charlie expressed dismay and blamed Holmes' investors, whom she referred to as, quote, sophisticated assholes.

Ultimately, both the bank and the SEC's civil suits were put on hold to allow the criminal case to proceed.

Charlie's effort to be tried separately from Olivier, her ex-colleague who she worried would turn against her, was denied.

After some additional delays, the Frank executives' trial began on February 17, 2025.

The prosecution, led by Assistant U.S.

Attorney Rashmi Baskarin, sought to paint Charlie as an overly ambitious, ruthless businesswoman driven to succeed at any cost, including committing fraud.

This deal was based on lies, Baskarin said in her opening statement.

The defendants Charlie Javes and Olivier Amar lied to make millions of dollars.

They made up a fake customers list, a list of 4 million people who did not exist.

They were this close to a deal that would make them millionaires.

There was only one thing that stood in their way, the truth.

Jose Baez presented the defense's opening arguments.

He labeled J.P.

Morgan's acquisition of Frank as a business deal that went wrong, a failure of due diligence on the bank's part, and bad timing.

The government pulled the rug right from under J.P.

Morgan Chase, and they had buyers' remorse, Baez said.

The only way out of the deal was by claiming fraud.

They get their money back, if it's fraud.

It's better than insurance.

Charlie DeVise will never get her good name back, Baez told the jury, but you can at least give her justice.

Over the next several weeks, a cascade of witnesses took the stand.

Leslie Williams Morris, Chase's then-chief of corporate development who led the acquisition, testified that Frank's user numbers were the crux of the deal.

She also admitted that the bank might have rushed the process because they thought they were bidding against other institutions.

That concern was proven true when Capital One's head of corporate development testified that they were in on the deal but bailed after its due diligence process raised doubts about Frank's data.

The most compelling moments of the trial came when Frank's former head engineer, Patrick Vauvour, testified that he was asked to create the fake list but declined.

During cross-examination, Charlie's defense team suggested that he had the motivation to lie.

Mr.

Vauvour, you wanted to date Ms.

Javis, didn't you?

Ronald Sullivan asked.

You resent the fact that Miss Javis didn't want to date you.

Isn't that right?

No, Vevor answered.

You sent her flowers, yelled Sullivan.

You also sent Miss Javis a separate message saying that you have a terrifically fit body.

I don't recall doing that, Vovor replied.

Later, Adam Kapellner confirmed his role on the stand, but denied knowing what the data would be used for.

His testimony was almost more damaging to Chase than Javis.

Kapellner said the data could have easily been revealed as fake with some, quote, basic due diligence.

All the bank had to do was call a few of the phone numbers, Adams said.

Neither Charlie Javis nor Olivier Amar, whose defense portrayed him as an innocent man lumped into his boss's problems, took the stand.

After a six-week trial, the jury deliberated the verdict.

Both Javis and Amar were found guilty on all four counts of conspiracy, wire fraud, securities fraud, and bank fraud.

The founder of that fintech startup, Frank,

Charlie Javis,

has been found guilty at a fraud trial.

If you recall, she had sold that college financial aid startup Frank to JP Morgan for $175 million back in July 2021.

And then later, she was accused of falsely telling that U.S.

bank that Frank had 4.25 million customers.

Both Javis and Amar, who plan to appeal their convictions, will remain free before sentencing, which is scheduled for the summer of 2025.

They are facing a maximum possible prison term of 30 years.

Once again, Charlie Javis's team pushed to remove her ankle monitor so she could continue working as a Pilates teacher in Miami, where she lives.

This time, that motion was denied on the basis that Charlie is a dual citizen of the USA and France, so there was no guarantee that she was not a flight risk.

The civil suits against Charlie Javis and Olivier Omar are still pending.

The federal government recently implemented a new, improved, and streamlined FAFSA in 2024.

However, the Department of Education has since been dismantled.

Swindled is written, researched, produced, and hosted by me, a concerned citizen, with original music by Trevor Howard, aka Deformer, aka The Best Partner in Crime.

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Thanks for listening.

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I sent another voice note where I was saying how we should probably go back to the time where we, you know, we could trade a few beans for a goat.

Things were simpler then.

But I was like, this is getting a little bit too convoluted.

Keep up the good work.

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