--- title: "JPMorgan Says Startup Tricked It Into an Acquisition by Cooking Up Millions of Fake Users" description: "JPMorgan says it was tricked to pay $175 million for a startup that had fabricated millions of users. File under: nothing's real anymore!" date: "2023-01-15" modified: "2023-01-15" authors: - name: "Maggie Harrison Dupré" job_title: "Senior Staff Writer" link: "https://futurism.com/authors/mharrison" url: "https://futurism.com/jpmorgan-claims-startup-tricked-acquisition-fake-users" categories: - "Future Society" tags: - "financial technology" - "fintech" - "jp morgan" - "Startups" --- # JPMorgan Says Startup Tricked It Into an Acquisition by Cooking Up Millions of Fake Users ![JPMorgan says it was tricked to pay $175 million for a startup that had fabricated millions of users. File under: nothing's real anymore!]() *\Image: Getty Images/Futurism\* JPMorgan Chase, one of the most powerful financial institutions on planet Earth, says that it paid $175 million to acquire a fintech startup — only to discover, [*The Wall Street Journal* reports](), that the startup had allegedly fabricated the majority of its users, bolstering its value with millions of fake accounts. Nothing's real anymore. Cheers! Per the *WSJ*, the startup, called Frank — a financial platform for college students looking to apply for federal aid — approached JPMorgan in the summer of 2021. Impressed by the roughly 4.25 million users allegedly using the app, not to mention its formidable lineup of well-known VC backers, the bank bit, bringing both the platform and its founder, 30-year-old Charlie Javice, into the fold. "Frank offers a unique opportunity for deeper engagement with students," Jennifer Piepszak, co-CEO of JPMorgan, said in a [September 2021 press release](). "Together, we'll be able to expand our capabilities for students and their families, helping them financially prepare for college and other major moments in their future." Things seemingly went swimmingly until sometime last spring, when the bank apparently tried to send an email to Frank's alleged millions of customers. According to JPMorgan, an astonishing 70 percent of those emails bounced back, leading to an investigation against Javice and the company. The results of that investigation, if true, are wild. The bank is alleging that Frank actually had *less than 300,000 real users*, which chalks up to less than 10 percent of the user figure that Javice had sold the site on. (In the [court filing](), JPMorgan provides correspondence between Javice and a professor that she allegedly hired to create the phony accounts.) Rest assured, JPMorgan is pissed. As of last month, they're suing Javice and Frank's chief growth officer, Olivier Amar. "To cash in, Javice decided to lie, including lying about Frank's success, Frank's size, and the depth of Frank's market penetration in order to induce JPMC to purchase Frank for $175 million," [reads the bank's suit](), filed late last year in a Delaware court. "Javice represented in documents placed in the acquisition data room, in pitch materials, and through verbal presentations \[that\] more than 4.25 million students had created Frank accounts." It's worth noting that Javice actually filed her own lawsuit against the bank in the same week that the bank launched theirs, claiming that JPMorgan simply just didn't want to comply with user privacy laws and is now trying to conceal their own bad behavior. "After JPM rushed to acquire Charlie's rocketship business, JPM realized they couldn't work around existing student privacy laws, committed misconduct and then tried to retrade the deal," Javice's lawyer and [guy who is somehow just always there](), Alex Spiro, [said in a statement to *Forbes*](). "Charlie blew the whistle and then sued." "JPMC's newest suit is nothing but a cover," he added. At the end of the day, it's all weird, and certainly reeks of "everything is make believe" energy. And sure, it's definitely not cool to sell anything based on lies, if that's indeed how the court battle shakes out. But this case is arguably less about the individual who sold that product, and more about the massively powerful financial institutions that run our lives. There are a lot of people out there [who label nothing as something]() and try to sell it. But at the end of the day, [someone needs to buy it]() for it to really make a difference. When even the likes of JPMorgan can't seem to tell what's real, that's not exactly a good sign for the rest of us. **READ MORE:** *[JPMorgan Bought College Financial-Aid Platform for $175 Million—and Now Says Most of Its Users Were Fake]()* \[*The Wall Street Journal*\] **More on embarrassing purchases:** *[It's Still Easy to Impersonate a Senator on Twitter after Elon Musk Promised Verification Was Fixed]()* ## Author At Futurism, I've reported extensively on the rise of AI as a cultural and business force shaping the media industry, and more broadly how those dynamics are changing how we all consume and share information and relate to one another. I'm also fascinated by public health policy and ethics, the role of emerging tech in politics and governance — and the powerful people and forces at those intersections — climate change, and the environment. My investigation on Sports Illustrated's use of AI-generated authors with fictional biographies won a 2024 Mirror Award for "Best Story on Media Coverage of Artificial Intelligence in Journalism and the Media" from Syracuse University's SI Newhouse School, I contributed to Niemen Lab's 2025 Predictions for Journalism series, and I've discussed my work for Futurism during appearances on NPR, CNN, the BBC, the CBC, and more. I grew up in rural Pennsylvania and attended the University of Massachusetts Amherst, where I played Division I field hockey for the Minutewomen as a midfielder. Since then, I've lived in New Orleans, Louisiana and Manhattan, New York. I spend my free time running, reading, perusing archival fashion, and searching for the world’s best negroni. I also have a debonair tuxedo cat, Westley, who's named after "The Princess Bride." ### Author social links [Bluesky]()