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August 11, 2011

Former Chair of N.Y. Nonprofit Board Accused of Embezzlement

The chairman of the Manhattan Chamber of Commerce resigned Tuesday amid allegations that he stole $2.5-million from an unrelated nonprofit organization whose board he headed, according to Bloomberg and Crain's New York Business.

A lawsuit filed in federal court Tuesday by the Albert Ellis Institute, a psychotherapy charity, says Jeffrey Bernstein shifted the organization's funds into bank accounts he owns or controls while serving as its director of administration. He was appointed to the post in early 2010 after serving for 3 1/2 years as president of the institute's board of trustees.

Mr. Bernstein, chairman of New York corporate consultancy the Archstone Group, left the Ellis Institute in February when the allegations surfaced.

The nonprofit did not sue Mr. Bernstein, instead it is aimed at JPMorgan Chase. The institute says the bank allowed Mr. Bernstein to make dozens of unauthorized transactions from its accounts and has refused to restore the money. A spokeswoman for the bank declined to comment on the lawsuit.