Leo N. Levitt and Ruth G. Levitt - Page 27

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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                        
               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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