Workers at Frank, the startup led by Charlie Javice, raised concerns about the company’s financials prior to its acquisition by JPMorgan Chase for $175 million in 2021. Internal Slack messages between Frank employees, revealed in a court document filed in Delaware, showed skepticism regarding Javice’s directive to change the company’s public-facing numbers to claim 4.25 million users. However, JPMorgan accused Javice of inflating the user statistics and sued over being deceived in the deal. The Slack exchange displayed disbelief among junior team members about the inflated numbers. Javice, known as the “king of finding magic numbers,” was arrested in April on charges of defrauding JPMorgan. The indictment against her included charges of securities fraud, wire fraud, bank fraud, and conspiracy. The internal conversations occurred before the acquisition, and Javice’s lawyers declined to comment on the court filing. Javice claimed innocence and justified the change in user stats by considering website visitors as users. However, JPMorgan argued that user data was based on a specific reporting metric requiring customer information. It was alleged that Javice paid an outside data scientist to create a fake user base list to deceive JPMorgan. JPMorgan discovered the alleged fraud through the lack of responses when marketing materials were sent to the claimed users. They later learned that Frank’s user base was closer to 300,000 rather than the reported 4.25 million. Javice has insisted that JPMorgan knew the user count at the time of acquisition. Prior to the sale of Frank, Javice received recognition in the media, with Forbes including her on their “30 Under 30” finance list and Crain’s New York Business listing her on their “40 Under 40” list in 2019.
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