- 131 -
Based on our review of the entire record in these cases,
petitioner has failed to persuade us that the Bank transactions
took the form they did because the foreign corporations pledging
collateral desired to assist Radcliffe and BOT.
We have found on the instant record that petitioner has not
established that the Bank transactions took the form that they
did because of any nontax, business purpose of the foreign cor-
porations pledging collateral that petitioner alleges on brief.
(d) Summary
We have found on the instant record that petitioner has not
established that the Bank transactions took the form they did
because of any nontax, business purpose on the part of any of the
persons involved in those transactions that petitioner alleges on
brief. The only indication of the purpose for that form is
petitioner's acknowledgment on brief that the persons involved in
97(...continued)
preferred the form of the Bank transactions involving them for
that reason. We do not accept petitioner's contention that the
form of the transactions at issue involving Pioneer and its
subsidiaries Multi-Credit and Mandalay made their violation of
Hong Kong corporate law less obvious. As just stated, Hong Kong
corporate law prohibited not only direct loans to Radcliffe by
Pioneer and its subsidiaries, but also the pledging by those
corporations of collateral for loans to Radcliffe by the U.S.
banks in question. Furthermore, the parties do not dispute on
brief that in 1983, at the request of petitioner, Union Bank
released its lien on the $800,000 deposit of Multi-Credit that
secured the $800,000 NMSC loan during Multi-Credit's financial
reporting period. That petitioner found it necessary to have
Union Bank release that lien indicates to us that neither he nor
Pioneer and its subsidiaries Multi-Credit and Mandalay believed
that the form of the loan transactions at issue involving those
corporations made their violation of Hong Kong law less obvious.
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