Frank and Charlie Javice allegations found in 2018 settlement

Frank and Charlie Javice allegations found in 2018 settlement

Frank and Charlie Javice allegations found in 2018 settlement

  • Visitors to Frank’s website might get the mistaken impression that the company is affiliated with the federal government, the Department of Education said in 2017.
  • The department argued that Frank’s website was “likely to confuse consumers.”
  • The parties settled in 2018 after the Department filed a trademark infringement lawsuit.

Years before JP Morgan Chase accused Charlie Javice of fraudulently inventing clients for its student financial aid platform Frank, the 30-year-old fintech founder settled with the feds on allegations he says which his company might mislead students. The settlement documents, which were obtained by Insider, showed that Frank was forced to change the name of his website and disclose to consumers that he was not affiliated with the federal government.

In 2017, the Department of Education accused Frank of violating his mark on FAFSA, the Free Application for Federal Student Aid, a form completed by aspiring students and their families to determine eligibility for various grants and loans. The department said in a cease-and-desist letter that Frank may mislead applicants seeking the government’s official FAFSA website.

However, Frank had no formal affiliation with the Department of Education and was not recognized as a designated “FAFSA preparer,” according to records seen by Insider. Frank moved to the Ministry of Education in 2018.

Javice and Frank have come under intense scrutiny after The Wall Street Journal reported on Tuesday that financial giant JP Morgan Chase, which acquired Frank in 2021, was suing Javice for inventing millions of fake clients for justify the acquisition of the startup by the bank for 175 million dollars.

In another lawsuit, filed in December in Delaware, Javice accused JP Morgan of undermining Frank’s value “by pursuing ill-conceived business plans.” The bank fired her before it had to pay her $28 million as part of the acquisition, according to Javice’s lawsuit.

In an email, Javice’s attorney, Alex Spiro, said the settlement related to “a trademark dispute over a trade name. Nothing more.” Spiro has previously denied JP Morgan’s allegations.

Even before graduating from college in 2013, Javice had been hailed as a child prodigy by a financial industry eager to rebuild its image in the wake of the 2008 financial crisis. His focus on creating financial products for people traditionally overlooked by banks – the poor and students – earned her a spot on Forbes’ 2019 “30 under 30” list. A Wharton Business School video called her “The Voice of a Microfinance Generation”.

In 2017, Frank’s website was frankfafsa.com, the settlement said. On social media and elsewhere, Frank has sometimes referred to the form as “Frank’s FAFSA,” per the regulations. The domain name in particular “was confusingly similar” to the Department’s website, fafsa.gov, “and, therefore, was likely to confuse consumers,” according to the settlement.

Students and their families can complete the FAFSA for free at fafsa.gov. Frank offered a free service, but also tried to offer customers more expensive packages. For $500, for example, students and their families could pay Frank to negotiate with schools on their behalf for more financial aid.

The settlement required Frank to issue disclaimers stating that he was not affiliated with the Department of Education and to move to a new website, withfrank.org.

Insider got the settlement through college funding expert Mark Kantrowitz, who said concerns about how Frank characterized his company prompted him to file a company information request. with the Ministry of Education in 2018.

In numerous media interviews, including with Insider, Javice has presented herself as a revolutionary entrepreneur.

“I started a business and raised money in college, turning down a job in finance, even though I was told I would fail because I had no business experience,” he said. she told Insider in 2021. “My impatience to achieve my goals helped me see beyond that ‘conventional wisdom’ to take a risk that got me to where I am today.”

Do you have a tip or ideas to share? Contact reporter Katherine Long by phone or via the Signal encrypted messaging app (+1-206-375-9280) or email (klong@insider.com).

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