Executive of Frank Corporation remains entangled in JPMorgan lawsuit, as declared by the judge.
In a series of legal developments, Olivier Amar, the former chief growth officer at college finance planning startup Frank, and Charlie Javice, the company's founder, have found themselves embroiled in legal issues.
On Wednesday, Amar was added to amended complaints from the Justice Department and the Securities and Exchange Commission (SEC). The charges against Amar include wire fraud, bank fraud, securities fraud, and conspiracy. He pleaded not guilty to these charges in May.
The SEC alleges that Javice misrepresented Frank's user base, claiming 4.25 million users but later found to number roughly 300,000. Amar, according to the SEC, was involved in the generation of a 'synthetic' set of data to supplement actual data from visitors to Frank's website.
Amar negotiated with an external data compiler to procure data on millions of students for $105,000, as per the SEC's allegations. The SEC also alleges that Javice attempted to entice Chase into a deal worth $175 million, as a competitor bank was also allegedly pursuing the startup.
The initial omission of Amar from the DOJ's case sparked speculation that he may have been cooperating with prosecutors. However, Amar's lawyers claimed in March that Chase has been 'throwing in Mr. Amar's name when convenient despite knowing that Mr. Amar was not involved in either the alleged misconduct or any statements, representations, or warranties made to Chase during the merger.'
Chase sued Javice and Amar in December and shut down Frank's website in January. Amar received about $5 million from the merger and a $3 million retention bonus from Chase after the acquisition, according to the SEC. No information is available about which institution allegedly paid Amar on March 1, 2023, for a data collection on millions of students.
Javice appeared in court on Thursday and repeatedly shook her head 'no' during a prosecutor's summary of the case. She was charged in April and has also pleaded not guilty to the same charges as Amar. If convicted on the most serious counts, each of Javice and Amar could face up to 30 years in prison.
A federal judge refused to let an executive of Frank escape Chase's civil lawsuit against him and Frank's founder. Amar was released on a $1 million bond on Thursday.
In a counter move, Javice countersued Chase, alleging that the bank fired her from her role as head of student solutions to avoid paying her a $20 million retention bonus. The outcome of these legal proceedings will be closely watched by the fintech industry.
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