SEC Charges Additional Frank Executive with Fraud in Connection with $175 Million Sale of Student Loan Assistance Company

The Securities and Exchange Commission (SEC) has filed charges against Olivier Amar, the former Chief Growth Officer of Frank, for fraud related to the company’s $175 million sale to JPMorgan Chase Bank, N.A. in 2021. Previously, Charlie Javice, the founder and former CEO of Frank, was also charged in connection with the same fraudulent scheme. Javice and Amar allegedly deceived JPMorgan Chase by misrepresenting the availability of valuable data on 4.25 million students who used Frank’s service, when in reality the number was significantly lower, at less than 300,000.

According to the SEC’s amended complaint, Amar instructed a Frank engineering employee to create an artificial or “synthetic” dataset to supplement the actual data obtained from website visitors. This was done to fulfill JPMorgan Chase’s due diligence request regarding Frank’s user data before the acquisition. When the engineering employee refused to generate fictitious data, Javice and Amar allegedly collaborated to obtain data from external sources. Javice purportedly paid a data science professor to manufacture the necessary data, while Amar negotiated with an external data compiler and ultimately obtained data on 4.5 million students at a cost of $105,000. Frank then presented this data as genuine customers in response to JPMorgan Chase’s inquiries following the completion of the acquisition.

In addition to the charges previously brought against Javice, the amended complaint, filed in the U.S. District Court for the Southern District of New York, accuses Amar of violating Section 17(a)(1) and (3) of the Securities Act of 1933, as well as Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder. Amar is also charged with aiding and abetting Javice’s violations of those provisions.

The SEC’s investigation was carried out by Wesley Wintermyer and Lindsay Moilanen of the New York Regional Office. The litigation is being handled by Mr. Wintermyer and Daniel Loss, under the supervision of Tejal Shah. The SEC acknowledges the assistance of the U.S. Attorney’s Office for the Southern District of New York, which has announced parallel criminal charges related to the case.