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into bank accounts of fictitious entities, resulting in
substantial tax deficiencies for Resyn and that the deficiencies
were due to fraud. In re Resyn Corp. 81-2 USTC par. 9808 (Bankr.
D.N.J. 1981). The bankruptcy court found the following facts:
Resyn understated its corporate income by
diverting to Chemical Traders receipts of sales of
goods owned by Resyn but never entered on the Resyn
books and records as Resyn sales.
As noted earlier, "Chemical Traders" was a trade
name controlled by Leo Levitt, but the record before
the Court discloses no evidence that any business
entity using that name was ever located at 128 Clinton
Avenue, Newark, New Jersey, the listed business address
of same. There is no evidence that Chemical Traders
had any employees, any business records, or books of
account, conducted any business, filed any state or
federal tax returns or paid any federal or state income
taxes. The only evidence of its existence was the bank
account maintained in that name at the National State
Bank of Elizabeth, New Jersey. It is noted that
neither the Resyn bookkeeper, its accountant, and its
comptroller had ever heard of Chemical Traders until
the commencement of the Chapter XI proceedings in 1970.
However, despite the fact that it conducted no
business operation, large sums of money were deposited
into the Chemical Traders' bank account. The amount of
the deposits during the years in question is as
follows:
Year Amount Deposited Year Amounted Deposited
1963 $163,497.44 1967 $253,767.62
1964 297,115.00 1968 66,555.58
1965 248,437.13 1969 70,878.23
1966 526,815.53 1970 15,600.00
Many of the deposits in the Chemical Traders' bank
account resulted from transactions involving Rambach
Chemical Company or Rambach International Company.
During the years 1963 through 1970, the Rambach
companies purchased substantial amounts of chemicals
which belonged to Resyn but were shipped to Rambach on
invoices labeled Chemical Traders.
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