Startup founder sentenced to 7 years in US fraud case

TDT | Manama

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Startup founder sentenced to 7 years in US fraud case New York, United States A federal judge sentenced former tech start-up highflier Charlie Javice to just over seven years in prison on Monday after she was convicted of defrauding JPMorgan Chase on a $175 million deal.

Javice, who in 2021 sold her online business Frank to the US banking giant, was found guilty by a New York jury in March of charges the enterprise was built on millions of fabricated users.

US District Judge Alvin Hellerstein sentenced Javice to 85 months in prison, a Department of Justice spokesman said.

In their complaint, US prosecutors said Javice hired an outside data scientist to create a “synthetic data set” after a company engineer declined a request, citing concerns about illegality.

Javice had billed Frank as offering a way to simplify the process of filling out the US application for financial aid for higher education. JPMorgan was drawn to the platform as a means to market banking services to younger consumers.

Javice perpetrated “an audacious and multifaceted criminal scheme” that was “fueled by greed,” said Micah Festa Fergenson of the US Attorney’s office, which had sought a 12- year sentence.

While the case showed “very poor” due diligence on the part of JPMorgan, Judge Hellerstein said Javice’s conduct merited punishment.