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During his final semester at Colorado State University,
petitioner worked part time for George Moore Construction earning
between $6 and $7 per hour. Petitioner acquired first-hand
knowledge of the need for residential construction services and
believed he could earn more money by operating his own
construction business. During 1992, when petitioner was
approximately 24 years old, his father lent him approximately
$500 to $600 to start a construction business, under the name K&L
Exteriors Trim (K&L Exteriors). K&L Exteriors began with two to
three employees, and business was generated by word of mouth or
by petitioner’s contacts with other contractors at job sites.
K&L Exteriors did not maintain any inventory, and its business
consisted of providing services in the form of labor.
During 1993, petitioner organized a corporation called Four
Square Construction, Inc. (Four Square), for the sole purpose of
providing payroll services for K&L Exteriors. K&L would transfer
funds to Four Square each month, and then Four Square would
distribute the funds to the employees.
Petitioner did not have the business acumen to manage the
administrative side of the business. Petitioner managed and
performed the construction services, and he relied on his father
to manage the administrative matters, including the bookkeeping.
Petitioner trusted his father and was aware of his father’s prior
experience in administrative business matters, including his
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