The highly anticipated criminal trial of Charlie Javice, the founder of fintech startup Frank, commenced on Friday, with both sides presenting their opening arguments, as reported by Reuters.

During the trial, lawyers reaffirmed their initial claims and defenses, which were originally outlined in the lawsuit filed by JPMorgan Chase against Javice in December 2022. The financial services giant alleges that Javice fabricated millions of customers to deceive the bank into purchasing her company, Frank, for $175 million. This allegation also formed the basis of an SEC complaint, which accused Javice of making numerous false representations about Frank’s user base to entice JPMorgan.

According to JPMorgan, the alleged fraud was discovered when over 70% of marketing test emails sent to Frank’s customer list bounced back, raising suspicions about the legitimacy of the users.

Javice’s attorneys, on the other hand, argue that JPMorgan conducted thorough due diligence and that the lawsuit is a result of buyer’s remorse, stemming from a government change in the way financial aid forms are filled out. They claim that alleging fraud is a tactic to extricate themselves from the deal.

If convicted of deception and creating fake data, Javice, now 32, could face a significant prison sentence.

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