(NEW YORK) — A tech start-up CEO once considered a preeminent American entrepreneur has been arrested and charged with fraud for allegedly lying to J.P. Morgan Chase, the Department of Justice said Tuesday.
Charlie Javice, previously featured as a Forbes magazine “30 Under 30” honoree, was arrested Monday night in New Jersey for lying about the number of customers her company serviced with its student loan assistance program, according to DOJ.
“She lied directly to JPMC and fabricated data to support those lies — all in order to make over $45 million from the sale of her company,” U.S. Attorney Damian Williams said in a statement. “This arrest should warn entrepreneurs who lie to advance their businesses that their lies will catch up to them, and this Office will hold them accountable for putting their greed above the law.”
A spokesperson for Javice said she denies the allegations and her lawyer declined to comment.
The company, Frank, had been billed as a way to simplify the student loan application process. Javice is accused of fabricating data to make it appear as though the platform had millions more users in order to sell the company for $175 million.
She is charged with one count of conspiracy to commit bank and wire fraud, one count of wire fraud affecting a financial institution and one count of bank fraud, each of which carries a maximum sentence of 30 years in prison. She also faces one count of securities fraud, which carries a maximum sentence of 20 years in prison.
Javice enlisted the help of a data scientist to create a fake database that was used to convince JP Morgan Chase the platform had more than 4.25 million users, according to charging documents. The tech CEO also allegedly purchased real data on 4.25 million college students that she tried to pass off as her user data.
Javice made an initial appearance in court on Tuesday, and she was released on a $2 million bond that restricts her to certain parts of New York and southern Florida.
ABC News’ Luke Barr and Lisa Sivertson contributed to this report.
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