Forbes 30-under-30 girlboss arrested for selling company to JPMorgan for $175m pretending they had 4 million users when they only had 250k

No way

I fricking love how the gist of this story is "they were defrauded because nobody would possibly commit a crime this obviously and badly."

Power of 2 nooticers are the next step in human evolution

Based Excel-maxxer

Autism wins again.

Yep, from the lawsuit:

Rather than reveal the truth, Javice first pushed back on JPMC’s request, arguing that she could not share her customer list due to privacy concerns. After JPMC insisted, Javice chose to invent several million Frank customer accounts out of whole cloth.

Javice, along with her Chief Growth Officer Olivier Amar, first asked Frank’s Director of Engineering to create fake customer details using “synthetic data” techniques. In plain English, “synthetic data” is fake information typically created by computer algorithms. Not comfortable, the engineer asked Javice and Amar whether the request was legal. In response, Javice sought to assure the engineer that she was not requesting that the engineer engage in illegal conduct. The Frank engineer was not persuaded and declined to participate in the scheme, and instead said that he only would provide Javice with Frank’s actual list of customer accounts: fewer than 300,000 customer accounts as of July 31, 2021

Javice then turned to a data science professor at a New York City area college (the “Data Science Professor”) who advertised his “creative solutions” to data problems. Javice provided the Data Science Professor a list of 293,192 individuals who had started or submitted a FAFSA application through Frank. She then directed the Data Science Professor to use “synthetic data” techniques to create 4.265 million customer names, email addresses, birthdays, and other personal information based on the list Javice supplied

She paid this prof $13k to make the list seem accurate.

Then JPMC tried to use this list (because why else buy the fricking company?):

In January 2022, to test the quality of Frank’s customer list and the receptiveness of these customers to JPMC’s products and services, JPMC requested that Frank send Frank’s list of 4.265 million customers to a JPMC marketing team. Javice and Amar, however, knew that list did not exist.

Unsurprisingly, the results of the marketing test campaign were disastrous. Specifically, JPMC sent marketing test emails to what it believed were 400,000 unique Frank customers. Of the individuals contacted, only 28% of emails were delivered, compared to a 99% delivery rate JPMC usually sees with similar campaigns. Just 1.1% of the delivered emails were opened, compared to 30% for a typical JPMC campaign.

So is this a compulsive lying issue or what? How did she see this playing out? It's not like returning a vitamix box full of rocks to Amazon, at some point they were inevitably going to look closely at the software they bought.

I honestly respect them for taking sucker's money. Be good looking women and act confident and you can rip off middle iq men.

This was Theranos 2.0 but not as successful

She's Jewish

If you can't tell she's jewish looking at that first picture, you need to fix your jewdar bro

you can kinda tell by looking at her brother's picture. Plus her isreali cofounder, her "Chief Growth Officer" who got charged with her was also from isreal. They stick together. Google only gave me this headline:

It's same shit as Elizabeth Holmes, people badly want the story of the girl Google Guys with almost religious intensity. A good fraud is about knowing the story people want. War Nerd John Dolan wrote about it, I think he did academic work on book frauds, and that was his conclusion.

"wait a second"

"yikes. you incel?"

The real problem is Techbros put unrealistic standards on women, like expecting them to be capable of creating a high growth startup from nothing, that they get pressured into faking it.

Got too hot and the makeup melted off

trans lives matter

Yeah, this write up didn't even include the data scientist!

Bloomberg

Programming note: Money Stuff will be off tomorrow and Monday, back on Tuesday.

Frank!

In 2021, JPMorgan Chase & Co. paid $175 million to acquire Frank, a financial technology company that helps students fill out college financial aid forms. It is not obvious why this would be a lucrative business for JPMorgan, or Frank, but that was not really the point of the acquisition. The point of the acquisition is that helping students fill out college financial aid forms, while not itself lucrative, might help you build long-term financial relationships with them at an early and impressionable point in their lives. If Frank helps a student fill out her financial aid forms, she might like Frank, so when Frank emails her and says “hey now that you’re in college you should set up a checking account, here’s one,” she might open the checking account — at JPMorgan — that Frank recommends. Later, she might get her mortgage through a Frank recommendation. JPMorgan was buying Frank’s customer relationships, so that it could use them to sell financial products that were lucrative.

That is, in some sense, JPMorgan paid Frank $175 million for an email list. As the proprietor of an email list myself, I have some interest in this transaction.

It went poorly. Frank’s founder, Charlie Javice, kept running Frank after it became part of JPMorgan, but in November 2022 JPMorgan fired her, and now she and JPMorgan are suing each other. Here is Javice’s lawsuit against JPMorgan, which basically demands that the bank pay her legal fees; her lawyer is Alex Spiro, who is also Elon Musk’s lawyer, so I assume he’s expensive. Here is JPMorgan’s lawsuit against Javice, which accuses her of fraud: The gist of it is that JPMorgan now says that Frank’s email list, which it paid $175 million for, was fake.

One thing that the two lawsuits agree on is that, when JPMorgan took over Frank, its first order of business was to spam Frank’s customers with JPMorgan marketing. Here’s how JPMorgan puts it:

In January 2022, after JPMC acquired Frank, JPMC began work on a marketing campaign to test the quality of Frank’s customer account list and the receptiveness of these customers to JPMC’s products and services. To facilitate this marketing campaign, JPMC asked Javice and [Frank Chief Growth Officer Olivier] Amar to provide Frank’s user list so that JPMC could send the marketing test by email. …

SHOW MORE

https://webcache.googleusercontent.com/search?q=cache:xiCgOpyi9wgJ:https://www.bloomberg.com/opinion/articles/2023-01-12/jpmorgan-says-frank-was-fraud&cd=1&hl=en&ct=clnk&gl=us

Javice, Amar, and the Director of Engineering then had a Zoom meeting during which Javice and Amar asked the Director of Engineering to help them create a synthetic list of customer data. She asked the Director of Engineering if he could help her take a known set of FAFSA application data and use it to artificially augment a much larger set of anonymous data that her systems had collected over time. The Director of Engineering questioned whether creating and using such a data set was legal, but Javice tried to assure the engineer by claiming that this was perfectly acceptable in an investment situation and she did not believe that anyone would end up in an “orange jumpsuit” over this project.

The Director of Engineering was not persuaded and told Javice and Amar that he would not perform the task and only would send them the file containing Frank’s actual users, which amounted to approximately 293,000 individuals at that time.

lol

Even better, she stayed with JP Morgan