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JPMorgan Chase Sued by Ellis Institute Over Money Transfers by President


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Jan 17, 2010
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New Jersey
The Manhattan Chamber of Commerce’s chairman illegally transferred more than $2.5 million to his own accounts while running the Albert Ellis Institute, the nonprofit said in a lawsuit claiming JPMorgan Chase & Co. (JPM) let it happen.

Jeffrey Bernstein, the former president of Albert Ellis¬í board of trustees, ¬ďsecretly and without authority or the knowledge of its other trustees¬Ē moved institute funds into personal bank accounts he owns or controls, the organization said in the lawsuit.

Bernstein was first elected to the institute’s board of trustees in March 2006 and was chosen as president of the board in July 2006, the institute said in the lawsuit. He was named acting director of administration in January 2010 and appointed to the permanent post the following month. Bernstein resigned from all offices he held at the institute after the fraud was discovered in February 2011, lawyers for the group said in the complaint, which was filed today in federal court in Manhattan.

JPMorgan has been provided with a list of 65 unauthorized transactions by Bernstein and has refused to restore the funds to the institute’s account, lawyers for the institute said in the lawsuit, which seeks more than $2.3 million in damages.

U.S. Investigation

The institute contacted Manhattan District Attorney Cyrus Vance’s office about the alleged fraud, and the U.S. Attorney’s Office in Manhattan is investigating, David Blasband, an attorney representing the institute, said in a telephone interview.

Joan Vollero, a spokeswoman for Vance’s office, declined to comment on whether the district attorney is investigating. Ellen Davis, a spokeswoman for U.S. Attorney Preet Bharara, didn’t respond to an e-mail seeking comment on the lawsuit.

Jennifer Zuccarelli, a spokeswoman for JPMorgan Chase, declined to comment on the lawsuit. Patrick J. Smith, an attorney representing Bernstein, didn’t return a telephone message left at his office seeking comment on the complaint. Bernstein isn’t named as a defendant in the suit.

The institute, located on East 65th Street in Manhattan, is a not-for-profit psychotherapy organization founded in 1959 by its late namesake, Dr. Albert Ellis. It is ¬ďcommitted to alleviating emotional disturbances and enhancing emotional well- being through the study, teaching and application of rational emotive and cognitive behavioral therapy,¬Ē according to the lawsuit.
¬ĎChart Our Course¬í

The Manhattan Chamber of Commerce has no information about the matter, President Nancy Ploeger said in an e-mailed statement. Bernstein has resigned as the chamber¬ís chairman effective immediately, and the organization¬ís board will meet as soon as possible to ¬ďchart our course going forward,¬Ē Ploeger said in the statement.

read more JPMorgan Chase Sued by Ellis Institute Over Money Transfers by President - Bloomberg

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