- 4 -
approximately $125,000 in SJC; and in 1989 SJC filed
for bankruptcy;
(2) he suffered losses as a Lloyd’s underwriter;
(3) in 1991 he invested $25,000 in a company
called Marisco International Trading (Marisco) in which
Al Marisco was the principal; and Marisco “wound up” in
1992 (but petitioner testified that he was not able to
verify this);
(4) in 1984 he invested $5,000 in a company called
C Films; C Films “wound up” years later; and he lost
his entire investment in C Films; and
(5) he advanced approximately $85,000 to a company
his wife founded and ran called Stamp, Stamp, Stamp
(SSS); SSS closed in 1993; and he lost $50,000 when SSS
closed.
We review the economic realities of transactions between
family members--i.e., the SSS transactions--with heightened
scrutiny. Estate of Reynolds v. Commissioner, 55 T.C. 172, 201
(1970). Petitioner relies on his own testimony to substantiate
his losses from SJC, Lloyd’s, Marisco, C Films, and SSS. The
Court is not required to accept petitioner’s unsubstantiated
testimony. Wood v. Commissioner, 338 F.2d 602, 605 (9th Cir.
1964), affg. 41 T.C. 593 (1964).
Petitioner did not present any evidence regarding when C
Films supposedly wound up or when he “lost” this investment.
Petitioner submitted 6 pages of a 13-page fax containing a
settlement offer and “Finality Statement - August 1996” regarding
Lloyd’s. The document does not establish that petitioner
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