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The Office of the Comptroller of the Currency (OCC) in the U.S.
scheduled a specific audit of JPMorgan's deal making after the
bank bought dozens of smaller companies in 2021 and 2022, the
report said.
This comes after the U.S. government filed criminal charges
accusing Charlie Javice, the founder of the now-shuttered
college financial aid company Frank, of defrauding JPMorgan into
buying the startup for $175 million in 2021.
Javice, 31, was charged by the Department of Justice with
repeatedly lying to the largest U.S. bank by claiming that Frank
had lined up 4.25 million student customers when in fact she had
data for only about 300,000.
JPMorgan had sued Javice and Olivier Amar, who was Frank's chief
growth officer, in Delaware federal court in December.
The OCC audit was scheduled before JPMorgan's lawsuit, the
report said.
Javice filed counterclaims in February, accusing JPMorgan of
having "compromised her reputation" and wrongfully withheld $28
million of retention payments and equity.
The bank shut down Frank in January, and Chief Executive Jamie
Dimon branded the acquisition a "huge mistake" in a Jan. 13
conference call with analysts.
JPMorgan and the OCC did not immediately respond to Reuters
request for comment.
(Reporting by Baranjot Kaur in Bengaluru; Editing by Jamie
Freed)
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