5 ms·

JP Morgan Says Startup Founder Used Fake Customers to Dupe It into Acquisition

46 points by coloneltcb 4y ago

alexpetralia 4y ago
I can imagine JP Morgan will update their due diligence procedure after this. I'm surprised this hasn't happened more in the past, actually.
- haskellandchill 4y ago
  The fraud was pretty thorough, they paid a data scientist $20k to falsify data and paid another business $100k for their list. They also performed third party validation on it as a test. It was only upon Chase marketing to the full list that the statistics became apparent. Random sampling may not have been enough.
troon-lover 4y ago
[dead]
donsupreme 4y ago
according to Linkedin Charlie Javice is currently still employed as managing director at JP Morgan?! https://www.linkedin.com/in/cjavice/ https://www.linkedin.com/in/cjavice/
- hodgesrm 4y ago
  Maybe she's doing time somewhere? Just out of curiosity what would be the best way to update your LinkedIn in this case? "On sabbatical" does not seem to quite cut it.
  - mickelsen 4y ago
    Some people just leave the timer running, they only bother to update it when they already have a new job. I would do that. A senior exec could do consulting for a foundation, an engineer just put the freelance practice. I wouldn't be bothered to fill in the gaps there, that's just for the HR drones during the first-pass filter.
- naturalauction 4y ago
  The article does state that she was fired. > Amar was fired in October and Javice, in November.
- yuppie_scum 4y ago
  LinkedIn says a lot of things
TrackerFF 4y ago
Yet another "30 under 30" success story.
elecush 4y ago
"Fooled us into acquiring your company"
unstatusthequo 4y ago
I guess sometimes due diligence just means take their word for it?
toomuchtodo 4y ago
DoJ investigating the alleged fraud?
ctvo 4y ago
> “After JPMC rushed to acquire Charlie's rocketship business, JPMC realized they couldn't work around existing student privacy laws, committed misconduct and then tried to retrade the deal,” Javice’s lawyer, Alex Spiro, said in a statement emailed to Forbes. Is this the Alex Spiro? Elon’s lawyer in the Twitter case? Not good.
reiichiroh 4y ago
It’s growth hacking!
blitzar 4y ago
Your honour I would like you to dismiss the charges on the basis that my client carefully and faithfully deployed the time honoured entrepreneur grind set and faked it till they made it.
deleted 4y ago
[deleted]
greatgib 4y ago
Just to clearly see how much assholes are JP Morgan, buying a startup for its users data to send them unsolicited crap: Once the deal went through, JP Morgan asked Frank for its customer list so the bank could begin marketing its products and services to those students, the suit says.
atombender 4y ago
According to the article, not only did Charlie Javice scam JP Morgan, but her company, Frank, did not really help students with loans in any meaningful way, and was essentially a data gathering operation disguised as a service.

46 points by coloneltcb 4y ago

I can imagine JP Morgan will update their due diligence procedure after this. I'm surprised this hasn't happened more in the past, actually.

haskellandchill 4y ago
The fraud was pretty thorough, they paid a data scientist $20k to falsify data and paid another business $100k for their list. They also performed third party validation on it as a test. It was only upon Chase marketing to the full list that the statistics became apparent. Random sampling may not have been enough.

troon-lover 4y ago

[dead]

donsupreme 4y ago

according to Linkedin Charlie Javice is currently still employed as managing director at JP Morgan?! https://www.linkedin.com/in/cjavice/ https://www.linkedin.com/in/cjavice/

hodgesrm 4y ago
Maybe she's doing time somewhere? Just out of curiosity what would be the best way to update your LinkedIn in this case? "On sabbatical" does not seem to quite cut it.
- mickelsen 4y ago
  Some people just leave the timer running, they only bother to update it when they already have a new job. I would do that. A senior exec could do consulting for a foundation, an engineer just put the freelance practice. I wouldn't be bothered to fill in the gaps there, that's just for the HR drones during the first-pass filter.
naturalauction 4y ago
The article does state that she was fired. > Amar was fired in October and Javice, in November.
yuppie_scum 4y ago
LinkedIn says a lot of things

TrackerFF 4y ago

Yet another "30 under 30" success story.

elecush 4y ago

"Fooled us into acquiring your company"

unstatusthequo 4y ago

I guess sometimes due diligence just means take their word for it?

toomuchtodo 4y ago

DoJ investigating the alleged fraud?

ctvo 4y ago

> “After JPMC rushed to acquire Charlie's rocketship business, JPMC realized they couldn't work around existing student privacy laws, committed misconduct and then tried to retrade the deal,” Javice’s lawyer, Alex Spiro, said in a statement emailed to Forbes. Is this the Alex Spiro? Elon’s lawyer in the Twitter case? Not good.

reiichiroh 4y ago

It’s growth hacking!

blitzar 4y ago

Your honour I would like you to dismiss the charges on the basis that my client carefully and faithfully deployed the time honoured entrepreneur grind set and faked it till they made it.

deleted 4y ago

[deleted]

greatgib 4y ago

Just to clearly see how much assholes are JP Morgan, buying a startup for its users data to send them unsolicited crap: Once the deal went through, JP Morgan asked Frank for its customer list so the bank could begin marketing its products and services to those students, the suit says.

atombender 4y ago

According to the article, not only did Charlie Javice scam JP Morgan, but her company, Frank, did not really help students with loans in any meaningful way, and was essentially a data gathering operation disguised as a service.