JPMorgan Chase on Thursday shut down the website for a college financial aid platform it bought for $175 million after alleging the company’s founder created nearly 4 million fake customer accounts.
JPMorgan said it learned the truth about Frank after sending out marketing emails to a batch of 400,000 customers. About 70% of the emails bounced back, the bank said in a lawsuit filed last month in federal court.
After being pressed for confirmation of Frank’s customer base during the due diligence process, founder Charlie Javice used a data scientist to invent millions of fake accounts, according to JPMorgan.
A lawyer for Javice told The Wall Street Journal that JPMorgan had “manufactured” reasons to fire her late last year to avoid paying millions of dollars owed to her. Javice has sued JPMorgan, saying the bank should front her legal bills.