Frank founder Charlie Javice is seeking access to JPMorgan Chase & Co. documents she says will exonerate her in the bank’s fraud suit against her, as well as in the criminal and SEC cases she’s facing.
In a Thursday court filing, Javice asked the Delaware federal judge overseeing JPMorgan’s lawsuit to allow her to demand documents from the bank and firms that advised it on the $175 million acquisition of her college loan planning site.
All three cases against Javice — by JPMorgan, Manhattan federal prosecutors and the Securities and Exchange Commission — allege that she falsified data to vastly inflate the number of Frank users during deal negotiations with the bank.
She has pleaded not guilty in the criminal case and is free on $2 million bond.
Pretrial evidence-gathering in JPMorgan’s lawsuit is on hold under a law governing civil securities fraud cases. In her Thursday filing to US District Judge Maryellen Noreika, Javice said her lack of access to documents has left her unable to counter JPMorgan’s narrative of the case.
The bank’s “cherry-picked snippets of documents have been repeated aggressively in the press and, more tellingly, provided by JPMC to governmental authorities for use in those authorities’ investigations,” Javice said. Meanwhile, she’s faced “increasing monetary constraints and reputational damage with each passing day,” Javice added, noting that prosecutors have frozen her accounts.
“Defendants should not be put in a position of fighting the weighty allegations against them with their hands tied behind their backs,” Javice said.
Read More: JPMorgan Claims It Was Defrauded in $175 Million Acquisition
JPMorgan sued Javice and another Frank executive, Olivier Amar, in December, alleging they used fake customer accounts to exaggerate the number of people using the Frank site, in a scheme to dupe the bank. She allegedly engaged an outside data scientist to create fake user data when Frank’s own engineering director refused to do it.
Lawyers for Javice have called the suit “nothing but a cover” and said JPMorgan was just trying to “retrade the deal.” She is also countersuing JPMorgan.
Javice was charged criminally in April in Manhattan federal court, where she faces charges including conspiracy, wire fraud affecting a financial institution and bank fraud. Amar was not charged.
She was set to make $45 million from the deal, prosecutors said.
JPMorgan has also sought to lift the stay on document production, asking the court to give it access to Javice’s financial records. The bank said it was worried she had moved her money into accounts tied to shell companies in Nevada. The bank is not opposing Javice’s motion.
Javice has said the government’s freezing of her accounts negates any fears about her moving money. She said she wanted to move her money out of JPMorgan after the bank accused her fraud, though she noted that she initially transferred her funds to the ill-fated Signature Bank.
Read More: Frank Founder Javice Moved Millions to Signature From JPMorgan
Javice founded Frank in 2017 as an online platform to help college students fill out the Free Application for Federal Student Aid, or Fafsa. Forbes named her to its “30 Under 30” list for finance in 2019. JPMorgan shut down the site earlier this year.
The case is US v. Javice, 23-cr-251, US District Court, Southern District of New York (Manhattan).
(Adds position of JPMorgan on motion in 12th paragraph.)
