Another Forbes '30 Under 30' Heads to Trial & DOGE Wants Access to the IRS

0:26Race the rudders! Good morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, Argentina's president is caught in a scandal after promoting a meme coin that collapsed. Then another 30 Under 30 alum is set to stand trial today. Turns out fake it till you make it isn't always the best advice. It's Tuesday, February 18th. Let's ride.

0:55Welcome back to The Short Week. Hope you had a relaxing weekend. And look, there are a lot of things to worry about in this world, but maybe getting attacked by a shark is not one of them. According to a new report from the Florida Museum of Natural History, 2024 was a, quote, exceptionally calm year for shark bites. There were only 47 unprovoked attacks around the world last year, down 22 from the previous year and far below the 10 year average of 70. Toby, I think it's time. I'm ready to watch Jaws again. My question here, though, is where are these attacks taking place? Because there still were attacks worldwide.

1:33Last year, there were 28 confirmed bites in the United States. That accounted for 60 % of the worldwide total. And half of those attacks took place in my home state of Florida. Florida had a total of 14 bites. And of those, eight occurred in Volusia County, which is on the East Coast, is that Daytona Beach area. It's known as the shark attack capital of the world. So even though bites were down, there still were a few off the coast of Florida. All this being said, less instances of people being shark bait hoo-ah-ha worldwide. And that's a good thing. Now a word from our sponsor, LinkedIn Ads. Hope you all listening had a wonderful Valentine's Day.

2:12Neil, I was out to dinner on Friday and saw this couple eating. And you could just tell it wasn't going anywhere. Oh, that's painful. Get all dressed up, go out to eat. But if the spark isn't there, what's the point? If you aren't right for each other, going on a Valentine's date is just a waste of time and money. It's a lot like marketing to the wrong customers. Your messaging could be fantastic, but if your ad shows up in front of the wrong person, then it's not effective. LinkedIn ads can't save your relationship, but it can help you target and filter your audience by industry, company, and role.

2:41No more wasting time and money on the wrong people. It's 2025. Know your worth, kings and queens. You tell them, Neil. So LinkedIn will give you a$100 credit on your next campaign. So you can try it yourself. Just go to LinkedIn.com slash MBD. That's LinkedIn.com slash MBD. Terms and conditions apply only on LinkedIn ads. This episode is brought to you by State Farm. Checking off the boxes on your to-do list is a great feeling. And when it comes to checking off coverage, a State Farm agent can help you choose an option that's right for you. Whether you prefer talking in person, on the phone, or using the award-winning app, it's nice knowing you have help finding coverage that best fits your needs.

3:24Like a good neighbor, State Farm is there. Death, taxes, and 30 under 30 members running into trouble with the law. Charlie Javis, an alum from Forbes Distinguished List, is standing trial in a Manhattan federal court today for allegedly fraudulently inducing J.P. Morgan into buying her fintech company, Frank. Javis was once celebrated as a rising star in the fintech world and snagged a spot on Forbes' 30 under 30 list after starting Frank in 2017, just four years after graduating from Penn. The company helped students applying for financial aid and eventually attracted the intention of JP Morgan, who spent$175 million to acquire it in the hopes of folding in some of Frank's 4.25 million young users into its banking ecosystem.

4:11The only issue, according to prosecutors, 90 % of those users were fake, manufactured by a data scientist working under Javis and Olivier Amar, Frank's former chief growth officer. Neil, this case is an egg on the face moment for JP Morgan. Not necessarily financially, the price tag was relatively small for a bank of its size, but reputationally. Plus, it's another instance where a young charismatic founder a la Elizabeth Holmes, a la Sam Bankman-Fried, is standing trial for fraud, which has so far led to jail time. Yeah, so how did J.P. Morgan find out that this email list that they acquired was not as big as they thought?

4:51Just months after the deal closed, they sent out marketing emails to a batch of 400 ,000 supposed Frank customers. They found out that only 28 % of the emails were even delivered and just 1.1 % were open. That's according to the lawsuit that JPMorgan filed against Javis, which is separate from this government case. So if I saw something like 1.1 % were open, that'd be bad for the Morning Brew newsletter. It's even bad for a company you paid$175 million for. So they started digging in and found and they contend that most of this list was made up. It was just a very tough look for J.P. Morgan because let's go back to September 2021.

5:33J.P. Morgan's CEO, Jamie Dimon, said the bank wants to be a lot more aggressive in its approach to acquisitions. They see this young and up-and-coming company in Franks, so they go all out. They add it to their fold. But then J.P. Morgan's Jamie Dimon has come out and said that deal was a huge mistake. But that's the question here that prosecutors are trying to uncover here is that is buyer's remorse necessarily the same as criminal fraud? Javis says that she has all you have to do is Google what she's talked about her company. She says there's plenty of instances of me referring to our user base in the hundreds of thousands, not in the millions.

6:12Meanwhile, JP Morgan's like, no, we were told that this had this big, robust email list. Once we got it, we learned that a lot of the names on it were synthetic, were made up. So is it buyer's remorse or is it criminal fraud? That's what this trial is trying to get at. And you can't help but point out the similarities between Charlie Javis and some of the other Forbes 30 under 30 who are now in their, quote, hall of shame. And it seems like the people on Javis' team are fully aware of these comparisons that are going on. A spokesperson said the only similarities with Holmes is that they are young, good looking and savvy.

6:49That's the only comparison. This is a case of due diligence. JP Morgan knew what they were getting into and buyers remorse once they got it. One thing that is moving against Javis, though, in this case, though, is that Amar, you know, the chief growth officer that worked alongside Javis, is they are trying to do an antagonistic defense, which means that Amar will likely turn on Javis, which has, Javis was like, can we please be tried separately because this person's about to turn on me? However, that is not going to happen here. So that's something that should benefit the prosecutors in this case that these two are not providing a united front.

7:26It does look like we're gonna see like a he said, she said sort of trial. So we got a four week trial coming up. Javis has kind of a powerhouse defense team. Ron Sullivan, Harvard law professor, is her co-counsel. He has a reputation for taking on seemingly impossible cases. He secured an acquittal in a double murder case of Aaron Hernandez. And he also was on Harvey Weinstein's defense team for a bit. So we'll see how this plays out and whether she joins other Forbes under 30 and being convicted for fraud. How's everyone doing on their taxes? You making progress? The folks at the Department of Government Efficiency do want to know.

8:06A young software engineer working under Doge is expected to be granted access to the IRS's taxpayer system, a highly sensitive database containing private information on millions of Americans' tax returns, social security numbers, and banking details. The Internal Revenue Service is the latest agency to be infiltrated by Doge in its blitz to cut costs across the federal government. But the IRS is an outlier in the type of information it holds on American citizens. And some IRS employees have raised alarms that a political appointee would be granted access to the database known as the Integrated Data Retrieval System because of the highly private nature of its contents.

8:44This thing is kept under more lock and key than a Gringotts vault with only a select number of IRS workers allowed in to accomplish a specific and official task before getting out as soon as that's done. White House Deputy Press Secretary Harrison Fields defended the move, saying waste, fraud, and abuse have been deeply entrenched in our broken system for far too long. It takes direct access to the system to identify and fix it. But a similar Doge initiative to review Treasury Department payments has been blocked by a judge, and it's likely this IRS project could also find its way to court. Yeah, we are seeing this pattern play out across multiple agencies.

9:19I mean, just over the weekend, the top Social Security Administration officials stepped down after Doge members were trying to, you know, access sensitive personal data about millions of Americans. What are we seeing right now in the IRS? A Doge official stepping in, trying to access sensitive data about millions of Americans. The judge already pushed back against doing the same thing in the treasury payment. So clearly this is a pattern that Elon Musk's Doge agency is trying to carry out. And we are going to see constant pushback because you are right. It's extremely sensitive data. If it falls in the wrong hands, it violates Americans' privacy, but also can be dangerous if that data is weaponized against the American people.

9:59In fact, taxpayers who have had their information wrongfully disclosed or even expected in this database are entitled by law to monetary damages. The IRS commissioner themselves is not allowed into this database. It is very highly secure. Zooming out, though, the IRS has been this lightning rod for discussions and debate about how to modernize its system. It was built on code That was from the 1960s. The Biden administration plugged it with 80 billion dollars to modernize and go after tax cheats who are making over four hundred thousand dollars. Republicans tried to claw that back. Treasury Secretary Scott Bessent, who leads the IRS, said that he has three goals.

10:40It's collections, privacy and customer service. He said, I don't think there's anyone who thinks that the IRS has achieved its potential in either of those three. Right. That is something that I think a lot of Americans can get on board with, which is modernizing the IRS. Everyone has dealt with the IRS in some way, shape or form, and it has not been a pleasant experience. That being said, though, you don't necessarily want someone meddling with these systems as 150 million taxpayers are preparing to file their returns. Oh, I'm done. I know you over the weekend, you were very you were bragging to everyone.

11:14But the April 15th deadline isn't yet here. And so the fear is not only are they potentially getting access to this data that's very sensitive, but that they could break these systems as people are trying to file their return. So it is a double whammy of nervousness around those infiltrating the IRS right now. The Venn diagram of world leaders who have also messed around with mean coins now contains another name after Argentinian President Javier Mille's dalliance with crypto landed him in hot water. Mille promoted a coin called Libra in a post on X on Friday, writing, This is a private project dedicated to encouraging the growth of the Argentine economy.

11:55The coin immediately rocket upwards to eclipse a$4.4 billion market cap before making a rapid unscheduled disassembly and dropping 95 % mere hours later. Miele tried to save face by deleting the post, explaining that he was not actually familiar with the details of the project, but the damage was done. Rug pulling a meme coin as a sitting president is tough to ignore, and lawmakers have raised the possibility of an impeachment hearing. Miele also said he was looking into whether any laws were broken, which feels very Tim Robinson wearing a hot dog suit costume meme. Neil, a tough blow to Mille's credibility just as he was gaining steam for his unconventional approach to remaking Argentina's struggling economy.

12:38This is a huge scandal in Argentina. Plastered its front pages over the weekend for a president to be involved in a rug pull meme coin. You expect it from maybe some internet celebrities, Hayley Welch or something. But you don't necessarily expect it from a sitting president of a sovereign nation. This was also a massive wipeout. They're calling it the fastest construction and destruction of wealth in history. $4.5 billion worth of capital was erased in seven hours. That means a lot of people who saw Mille's tweet believe in him and said, oh, this would be good for the Argentinian economy, put in money, and they lost, many people lost all of it a mere hours later.

13:23Yeah, one of the issues was Libra. This coin had very flawed what they call tokenomics in the crypto space. 82 % of the supply was unlocked and sellable from the start. Whenever you launch a coin like this, you do want to check what is the lockup period for when insiders can actually sell their stakes. This coin had far too much supply available that people could immediately cash in and make a quick profit on it, which is why insiders, as soon as he tweeted out, sold their stake when it rocketed upwards and left just the normal people holding the bag. So it also kind of filtered through to the rest of the Argentinian stock market investors in Buenos Aires.

14:02It started dumping a lot of shares in big local companies. Their benchmark index actually saw its biggest intraday drop in roughly three weeks as this kind of filtered through the economy. And then I also just mentioned that there's a Venn diagram of world leaders who have also messed around with crypto. Trump is squarely in the middle of that as well. And Trump and Miele have kind of had this buddy-buddy relationship. So to see them both messing around in the crypto world, not necessarily in the most responsible way, is something that's a little bit alarming when you just zoom out on a global political scale.

14:36Yeah, I think people who are in the crypto space are saying, please stop doing this. You're ruining not only your credibility, but the cryptocurrency industry's credibility by promoting these sham coins. Up next, it is our winners of the weekend. Eczema isn't always obvious, but it's real. And so is the relief from EBCLIS. After an initial dosing phase, about 4 in 10 people taking EBCLIS achieved itch relief and clear or almost clear skin at 16 weeks. And most of those people maintain skin that's still more clear at one year with monthly dosing.

15:37Tell your doctor if you have new or worsening eye problems. You should not receive a live vaccine when treated with EpGliss. Before starting EpGliss, tell your doctor if you have a parasitic infection. Searching for real relief? Ask your doctor about EpGliss and visit epgliss.lily.com or call 1-800-LILY-RX or 1-800-545-5979. Tuesday on NBC, Jimmy Fallon and Bozema St. John host the highly anticipated new competition show. I hire 10 creatives from all walks of life. They will be battling it out to see who can impress the world's biggest brands. This is a huge opportunity. This is the battle for the next big idea.

16:12This is not play play. We're spending millions of dollars. I'm so excited to embark on this adventure with all of you. Make the best idea win! On Brand with Jimmy Fallon. Series premiere Tuesday on NBC. Welcome to Winners of the Long Weekend, the segment where Toby and I pick two things that are feeling as refreshed as your co-worker who took a quick trip to the DR. I won the pre-show planking contest, so I get to go first. And my winner is European defense stocks like Saab, BAA Systems, Ryan Metal, which all spiked to record highs yesterday. Defense stocks hitting records, not typically a good sign for your region security.

16:50And that is certainly true for Europe these days. In the past week alone, the Trump administration has left Euro leaders shell-shocked by signaling America was not so interested anymore in defending Ukraine or preserving their decades-long transatlantic alliance, leaving the Europeans to fend for themselves. What were those signals? The US and Russia will be holding talks in Saudi Arabia this week about ending the war in Ukraine. Note that Ukraine and European leaders were conspicuously left off the invite list. Then on Friday, Vice President J.D. Vance lambasted European establishment politicians to their faces at a security conference in Munich, leaving no doubt that even if Europe needs America, America will no longer be bothered with Europe.

17:32And that means a new era of rearmament is dawning on the continent. Upgrading defense and protecting Ukraine could cost Europe's major powers an additional$3.1 trillion over a decade. But as Poland's prime minister said yesterday, if Europe fails to spend on defense now, they'll be forced to spend 10 times more if they don't prevent a wider war. Toby, the security architecture that had existed in Europe for decades just got blown up in one week. Yeah, a lot more spending is going to be needed. And that is not me saying it. That is NATO Secretary General Mark Rutt saying that. He said that NATO's spending will have to be considerably more than 3 % of GDP where it's been, you know, for its current target is 2 % agreed upon all the way back in 2014.

18:16But it's not just that NATO spending needs to go up. It's that they think that a lot of that spending is not going to come from America. They are trying to resist, you know, the sirens call of just relying on America for all their weapons. And so that is why you are seeing this big, you know, boost of Europe's defense industry, because if spending is going up and those arms need to come from somewhere, and if they're not coming from America, that means they're probably coming from European weapons manufacturers. Right. So they had this target of 2.2 percent of GDP from all NATO countries going to defense spending in 2020 and 2014.

18:50It is currently inching up, but across NATO countries, European defense spending is now at an average of 2.2 percent of GDP last year. Poland is the only country that is anywhere near five percent, which is what Trump has urged Europeans to get to. The rest are around 2%. So you're going to see France, Germany, the UK, all of these countries spend way more on defense. That is boosting shares. And you also saw Treasury, not Treasury yields, that's the United States, bond yields across Europe spike yesterday because investors also expect there to be a borrowing boom to finance these defense plans.

19:26My winner of the weekend is the sport of hockey because, Neil, I, along with many other people who can't explain the icing rule, actually watched it this weekend. The reason for our hockey curiosity is a tournament called the Four Nations Face-Off, which features NHLers from USA, Canada, Sweden, and Finland. It's an international competition that the NHL cooked up as a replacement for its mid-season All-Star game, and boy has it blown expectations out of the water. Saturday's game between the U.S. and Canada averaged 4.4 million viewers on ABC, making it the most watched hockey broadcast in the U.S.

20:03outside of Stanley Cup Finals since 2019. A big reason for its success is just how much the players care. Saturday's game in Montreal started with the home crowd booing the U.S. national anthem, followed by three consecutive fights within the first minute. Contrast that to say the NBA All-Star Game, which was also hosted over the weekend, and the massive gulf and effort between the two was clear. Neil, Canada and the U.S. won yesterday to set up a rematch in the final, which will be held in Boston. Guess all you need for a successful midseason exhibition is some tense geopolitics and a willingness to drop the gloves.

20:39I can't wait for Thursday night. You know, that game got 4.4 million viewers on Saturday. I expect this game on Thursday is going to blow it out of the water. Hockey got a lot of deserved praise for changing up their All-Star Game format to this Four Nations idea. J.J. Watt called it the best idea hockey has had in a long time. And you're right, you can't help but contrast it with the NBA All-Star Game, which happened on the same weekend. They also were not happy with the way the All-Star Game was going. You know, last year, some team put up 200 points, so it seems like the athletes did not care.

21:17But in contrast to what hockey did, the NBA got terrible reviews for they mixed up their weekend a little bit. That included a ton of pauses. There was a Mr. Beast promotion where he gave a fan$100 ,000. That may have been the best part of the weekend. But it was very interesting to compare the two sports leagues and how they tried to rejigger their all-star weekends that had been floundering. One to great success and the other looks like they're going to have to go back to the drawing board. Yeah, it was just a massive boost in viewership as well. Part of it was it was kind of just a dull sports weekend.

21:51So when we were deciding what to watch on TV, like the NHL was there for a lot of fans. But it was just so entertaining. I mean, you have the geopolitics, obviously, of, you know, these tariffs that we're trying to apply on Canada. And Canada started booing the American national anthem. And so just to see all the players just immediately drop gloves. These are teammates, too. That's what's funny about this is that a lot of these players play on the same teams. But when it comes to representing their countries, it just goes into another gear. And it's just so apparent when you're watching the product on there.

22:22And it got great viewership. I mean, ABC said that the game was up 369 % versus the current average viewership for NHL games on ABC. Postseason games last year averaged 1.5 million viewers. This was four times that level. And you said the final on Boston is going to be, I would assume, orders of magnitude larger than that as well. So just a big win for hockey. And I'm fully hockey-pilled at this point. Now for a special Tuesday edition of the week ahead, on account of it being a holiday yesterday. Here are the major events to look out for this week, besides that big game on Thursday. Walmart earnings later will be a closely watched gut check on the U.S.

23:03consumer. Things don't appear to be trending in the right direction. Consumer sentiment has fallen to its lowest level in seven months. Retail sales posted their biggest drop in almost two years in January. and inflation is picking back up, surging the most in nearly a year and a half last month. As the nation's biggest retailer, Walmart will either put some of those fears to rest or send investors into something resembling panic mode. Those retail sales from January do have some explanation attached to them though. One, we had this huge cold spell across the country, which usually keeps consumers inside their houses.

23:35And then also the number from December was revised higher. So it was just a rejiggering of some of those numbers. That being said though, you do want to see if you are looking at the wider retail industry, Walmart's a great bellwether for that. So you want to see those, you know, coming in stronger than expected. What is Tim cooking up at Apple? On Wednesday, Apple is expected to drop a new product after Cook Tease last week. Get ready to meet the newest member of the family. If he's not getting a dog, it could be that he's going to unveil the next generation iPhone SE4. But other reports speculate the new family member It could be a MacBook Air, an updated iPad, or a new HomePod, the smart home command center.

24:16Maybe it's all four. We'll find out tomorrow. I know. People were, you know, poring over every single word in this announcement. The language, newest member of the family, makes people think that it won't just be a continuation of the iPhone SE. It probably will be a similar product to the iPhone SE, but it might have a different name and it might be folded in closer to their broader iPhone offering. So it could be just semantics. could be something completely different, but it was interesting to see, you know, Apple analysts going, newest member of the family. What does that mean? It has to mean something different.

24:48All right, I've waited so long to say this. Spring training is back. Baseball returns to sunny Arizona and Florida this week as teams kick off a month of preseason games. This offseason was marked by massive spending by the wealthiest teams to bolster their rosters. The defending champs Dodgers spent more than$450 million in free agency, while the Mets wrote a$765 million check to Juan Soto, the richest contract in sports history. Until spring training becomes a Four Nations face-off, I'm not watching, Neil. Give me the U.S. versus Dominican Republic versus Cuba versus Japan, I think. That exists.

25:27It's the World Baseball Classic. I know, but I want Four Nations specifically, and I want it now, okay? You don't understand being a Northeasterner and having it being so cold out, and then you flipping on the TV to see Grapefruit League in February and then playing baseball in short-sleeved shirts. And you're like, spring is finally coming. Listen, I understand what it's like to be a Floridian and see those Northeastern, see those pale people who have been cooped up for months, come down to Florida to watch. So I absolutely know what you're talking about. Okay, let's wrap it up there. Thanks so much for starting your morning with us and have a wonderful Tuesday.