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Wow, the coverup is actually even more hilarious than the initial fraud here. Kind of clever, you can see they thought they might get away with it. > 133. Whil
by extr 4y ago
Wow, the coverup is actually even more hilarious than the initial fraud here. Kind of clever, you can see they thought they might get away with it.
> 133. While Javice was working with the Data Science Professor in early August 2021, Amar contacted ASL to obtain the ASL List containing student data for 4.5 million college students.
> 136. Amar continued to correspond with ASL over the following days. Through this additional correspondence, Amar learned that ASL could sell Frank a list of data for 4.5 million college students for a cost of $105,000.
So basically they knew they would eventually be found out, so they just elected to buy the 4.5 million contacts for $105K from ASL.
> 149. Ultimately, Javice presented to the Data Science Professor the ASL List of 4.5 million college students and told him that she wanted to "augment" that list. Upon information and belief, Javice represented to the Data Science Professor that the 4.5 million college students on the list were actual Frank accounts. Javice directed the Data Science professor to find a company that could "augment" the list with additional information, including phone numbers, dates of birth, and email addresses.
This data apparently wasn't complete enough, so they then got the original "Data Science Professor" to try to enrich it through commercial sources. Hilarious, the two companies he explores are Emformion and...Acxiom! This freaked them out, so they told him not to tell Acxiom who he was working for. Which they didn't buy. So they only got 1.9M of the 4.5M email addresses matched through Emformion. And things unraveled from there, as they eventually were asked to provide the original list and of course they didn't have it, or anything close to it. Etc etc
- extr 4y agoI'm naive to this space, but would this perhaps have just been legit business if they had done it in reverse order? 1. First buy data from ASL. Instead of 4.5M, buy as many as you can, like 40M, the entire 15-24 population if they got it. Apparently at ~$100K/~5M, this is only like $1M. 2. Do your own aggressive email/marketing outreach to these people. 3. If you can get 10% response rate, that's 4M customers right there. 4. Sell to JPM for $175M. I need to get into the lead generation business.
- jonathankoren 4y agoYeah, that would work, but the problem is they told JP Morgan they already had the list, and had nowhere near enough time to legitimately grow to the number of customers they said they had
- PragmaticPulp 4y ago> 3. If you can get 10% response rate, You can't get anywhere near a 10% click rate with random leads like that. The reason companies like this are sought after is the idea that their users are warm leads with an existing relationship with the brand. People who have (supposedly) gone out of their way to sign up for something are several orders of magnitude more likely to engage with e-mails compared to e-mailing them randomly from an unknown brand.
- extr 4y agoThat makes sense. It's just funny to think of this entire company essentially existing as a glorified landing page/warm transfer to a huge bank.
- TheDong 4y agoMatt Levine wrote about this with more info: https://archive.md/FTJUq https://archive.md/FTJUq To quote the relevant bit: > JPMC reached out via email to a random sample of the list Frank provided – approximately 400,000 purported customers of Frank – with offers to open Chase checking or savings accounts. Of those 400,000, only 103 even clicked through to Frank’s website. So a clickthrough rate of 0.026%. Good luck getting anything close to 10% when you're starting with a cold, and possibly partially trash, dataset.
- extr 4y agoOf course, that makes sense. I liked how Levine highlighted that using the figures here for the acquisition cost we can ballpark the warm leads as ~1000x more valuable than the trash leads.
- 4y ago