The SEC’s complaint alleges that Frank founder and CEO Charlie Javice orchestrated a scheme to deceive JPMC into believing that Frank had access to valuable data on 4.25 million students who used Frank’s service when in reality the number was less than 300,000. As negotiations progressed, JPMC pressed the Frank executives for the data associated with its customers, and Javice allegedly sought the help of Frank’s director of engineering to generate synthetic data to make it appear as if Frank had 4.25 million customers. When the director refused to comply, Javice allegedly paid a data science professor to manufacture the data required to close the deal with JPMC. The SEC’s investigation shows that, as a result of the eventual $175 million acquisition of Frank, Javice received $9.7 million directly in stock proceeds, millions more indirectly through trusts, and a contract entitling her to a $20 million retention bonus as a new employee of JPMC. "Rather than help students, we allege that Ms. Javice engaged in an old school fraud: she lied about Frank’s success in helping millions of students navigate the college financial aid process by making up data to support her claims, and then used that fake information to induce JPMC to enter into a $175 million transaction," says Gurbir S. Grewal, director of the SEC’s Division of Enforcement. "Even non-public, early-stage companies must be truthful in their representations, and when they fall short we will hold them accountable as in this case." JPMorgan Chase has also filed suit against Javice over the alleged fraud. She in turn has counter claimed in an effort to force the bank to cover her legal fees. In a countersuit filed against Chase in February, Javice’s attorneys accused the bank of "a massive ’CYA’ effort’" designed to "shift the blame for a failed and now-regretted acquisition to someone they view as an easy target: its young female founder."