Investing.com -- JPMorgan Chase & Co. (NYSE:JPM) had high hopes of gaining millions of fresh, young clients by purchasing Charlie Javice’s student-finance startup, Frank, for $175 million. However, Bloomberg reports the bank managed to add only 10 new checking accounts.
The results were revealed by Ryan MacDonald, a JPMorgan marketing executive, during Javice’s trial on Monday. Javice is facing charges of defrauding the bank by exaggerating the number of Frank users from less than 300,000 to over 4 million.
MacDonald testified that another bank executive had previously stated that JPMorgan was hopeful that the acquisition of Frank would provide a swift entry point to a large number of potential new customers, particularly within the 18-to-24 age bracket.
The bank sent out marketing emails to an alleged 400,000 Frank users in July 2022, nine months after the acquisition was finalized. MacDonald disclosed that only 28% of JPMorgan’s emails were successfully delivered to an active account, and a mere 2,000 recipients opened the emails.
From this pool, only a small fraction engaged with the bank’s offer by clicking through, and even fewer proceeded to open accounts. MacDonald highlighted that none of the new account holders were students, a demographic that had been a primary target of the acquisition.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.