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JP Morgan files lawsuit against millennial founder for faking 4 million accounts; Here’s why!

The new lawsuit that JP Morgan has filed may have been inspired by the fintech business that it spent millions of dollars to purchase.

In addition, if the investment bank is to be believed, the entire matter was started by an $18,000 check handed to a data science professor in the New York City area.

JP Morgan Files Lawsuit

JP Morgan filed a lawsuit on December 22 against Charlie Javice, the millennial founder of the student aid facilitating platform Frank, and Olivier Amar, the company’s chief growth officer, alleging the two fabricated approximately 4 million nonexistent accounts that they claimed used their service, which JP Morgan acquired for $175 million in September 2021.

JP Morgan asserts that in 2021, when the bank and Javice first discussed an acquisition, Frank was almost 4 million customer accounts short of its promises. 

Before submitting Frank’s legitimate client account data to JP Morgan for due diligence, the bank claims Javice and Amar went to the platform’s unnamed director of engineering to create synthetic data and fake customer data generated by computer algorithms.

Javice and Amar allegedly turned to an outside source, a data science professor at a university in the New York City region, when the engineer apparently became uncomfortable, questioned if the request was real, and ultimately declined.

The professor concurred and expressed a desire to offer creative solutions to Javice and Amar’s data-related worries, the lawsuit claims. What followed, according to the lawsuit, was an unusual number of email conversations.

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Founder Hires A Professor

JP Morgan-Professor-Accounts-Money-US
The new lawsuit that JP Morgan has filed may have been inspired by the fintech business that it spent millions of dollars to purchase.

It was made abundantly clear from the start that both the data science professor and Javice were aware that the data would be fictional. According to JP Morgan’s lawsuit, the data science professor was tasked with creating data for nearly 4.3 million customers, including names, emails, and birthdays, for Frank.

The professor allegedly sent an email to Javice proposing a technique to screen out genuine people’s identities by testing first and last names individually, to ensure that none of the names used as samples are real.

In another email, the professor allegedly remarked on how many of the accounts’ personal information histories were identical, including an improbable frequency of high school names and hometowns. The professor noted that if he audited such a list, it would appear suspicious to him.

The lawsuit claims that Javice informed the professor that having duplicate phone numbers among the accounts was acceptable as long as there was no more than 5 to 7 percent duplication.

According to JP Morgan’s lawsuit, the data science professor charged Javice $13,300 for his troubles. However, the summary of his work apparently proved troublesome, as the professor had allegedly recorded line items for each of the bogus information fields he had helped build. 

Javice immediately requested that the professor rework the invoice with a single line that stated data analysis, promising him a larger incentive and boosting the amount of the invoice to $18,000. The lawsuit alleges that the lecturer complied with the request.

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