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Thursday, May 26, 2016
Investigation continues in Korn Ponzi scheme
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Mandelup is seeking to recover a little more than $2 million from Ellen Korn. He says the money was transferred from the law firm’s attorney trust account to the personal accounts of Jay and Ellen Korn. “We believe most or all of it came from people who had identified themselves as investors that we believe … were part of a Ponzi scheme,” he said.

Through other actions, about $85,000 has been recovered for investors in Korn’s scheme, separate from Ellen Korn. But because of the scope of Korn’s Ponzi scheme, Mandelup said it is unlikely that investors were going to get all of their money back, and that this action against Ellen Korn would likely be the last taken in relation to Jay Korn’s scheme.

“I think the scope of the distribution to creditors will be largely dependent on how we do in this adversary proceeding,” Mandelup said.

As of press time Tuesday, Ellen Korn’s attorney, Michael Cornacchia, could not be reached for comment.


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