Leo N. Levitt and Ruth G. Levitt - Page 48

                                       - 48 -                                         
          petitioner paid them in cash.  During that time, resin cost about           
          10.5 cents per pound.  Petitioner said Atlas paid about 13 cents            
          per pound and petitioner paid Atlas 3 cents in cash.  Petitioner            
          said he got cash by forming Polymer and depositing in its bank              
          account the difference between the cost of resin and the amount             
          that Atlas paid.  Petitioner then bought and cashed cashier's               
          checks.  Resyn wrote checks totaling $87,750.12 in 1963, which              
          were deposited in the Polymer checking account in 1966.  A total            
          of $56,564.76 deposited in the Polymer checking account in 1969             
          was from checks written in 1968.  These delays are inconsistent             
          with petitioner's theory that he had to make cash payments to               
          Atlas.  It is implausible that the Tepperman brothers would wait            
          from 1963 to 1966 to be paid.                                               
               The Tepperman brothers died before trial was held in this              
          case.  The opinion of the bankruptcy court does not indicate, and           
          petitioners do not contend, that Resyn raised the business                  
          expense theory at the bankruptcy trial.  Petitioner's claim that            
          he paid all the money in the Polymer account to the Tepperman               
          brothers is not persuasive.                                                 
               3.   Diversion of Funds to Chemical Traders                            
               Petitioner controlled the Chemical Traders account.  He did            
          not tell his accountants and bookkeepers about it.  He withdrew             
          funds from the Chemical Traders account during each of the years            
          from 1964 to 1969 to buy stock and did not report those amounts.            
          He withdrew cash in 1970 and other years.                                   




Page:  Previous  38  39  40  41  42  43  44  45  46  47  48  49  50  51  52  53  54  55  56  57  Next

Last modified: May 25, 2011