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explained "that there were substantial tax benefits generated
from the transaction, but if it didn't fly economically those tax
advantages, i.e., the tax recapture, would have to be returned."
The two discussed the economics of the transaction, and Becker
told petitioner of his speaking to Canno and visiting Hyannis.
Becker also confirmed to petitioner that their father was
investing in a Plastics Recycling transaction.
Petitioner met with Becker for breakfast approximately 10
days later to discuss personal matters. Their conversation
turned to SAB Recovery, and petitioner expressed some reluctance
because he had never before invested in a tax shelter. According
to petitioner, Becker told him that he would save more in taxes
than he invested. Petitioner described his reaction as follows:
"I just said I can't believe it. It was beyond my imagination,
because I never was involved in anything like that, where you
could make an investment and save a lot more than that investment
in taxes." Petitioner understood from Becker that Becker and
some of his associates had investigated the Plastics Recycling
transactions. Petitioner invested in SAB Recovery after his
father verified that he, too, was investing in a Plastics
Recycling transaction.
In early 1982, Becker sent petitioner a copy of the SAB
Recycling offering memorandum. Petitioner invested in SAB
Recycling after briefly speaking with Becker, and again
confirming with his father that he, too, was investing in another
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