Frank

Chez Guevara — Dining in style at the Disaster Café™ →Go uptown Extract from the JC’s financial disasters roll of honour Scandal Date Where Loss Reason Firings Jail-Time? Frank 2023 US $175m Fraud, unfeasible gullibility Javice got fired. Surely more to come Not yet clear edit template Index: Click ᐅ to expand: Disaster Café Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.

What happened, according to JP Morgan’s own complaint.

• In 2017, Charlie Javice, a photogenic 24 year-old founds “Frank” : an online tool to help students apply for federal student aid. Not clear how Frank proposed to make money from this, but okay.
• In early 2021 Javice claimed to have helped millions of students obtain billion dollars of loans. (emphasis JP Morgan’s)
• In July 2021 Javice offered to flog the business to JPMorgan. She claimed to have 4.25 million “users”, being individuals who created an account on Frank’s website and supplied a first and last name, email address and phone number.
• This appears to have been a bare-faced lie.
• As part of its “critical confirmatory due diligence” JPM asked to see the account data.
• After a bit of hesitation and dissembly, Javice engaged an as yet unnamed data science professor, whom we will call the “dodgy data science professor” for reasons that will become obvious, to make up some plausible sounding data, using “synthetic data techniques”.
• She couldn’t make it, so she faked it. She paid the dodgy data science professor $18,000 for his trouble.
• Frank’s Chief Growth Office simultaneously bought a list of 4.5m actual high school students, college students and young people from a marketing firm for $105,000.
• On August 8, relying on the Fake Customer List and Amar and Javice’s representation and warranties, JPMorgan acquired Frank for $175m, and hired Javice and Amar as employees to run the business.
• In January 2022, to test the quality of the customer list, JPMC asked Javice to send the list to the JPMC client outreach team. Javice sent botch up of the actual young people data list they bought.

Belief Suspenders

Tough one. Javice has great hair and sparkly blue eyes? Young millennial? Instagrams well? Made it to the Forbes “30 under 30 lis”t?

Oh, come on ref

2

Captive advisors

Nope, apparently none.

This time it’s different

Kinda maybe you could say this is the young creatively uising the world wide web in a productive way, but no bitcoin, AI or DLT or anything like that.

Hiding in plain sight

Charlie Javice was pretty? Does that count?

Any ... actual money?

No actual money. Just a mailing list. That they made up!

Control defeat devices

Federal Trade Commission warned student aid platform Frank that it "may be unlawfully misleading consumers" about student COVID relief.

Settled allegations of misrepresenting its ties to the Department of Education.

See also

• JP Morgan Complaint