Lance Brown - Page 4

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          addition to tax.  Petitioner did not agree to these proposed                
          adjustments to his 1986 Federal income tax return.                          
               After respondent’s revenue agent proposed the above                    
          adjustments, petitioner submitted to respondent portions of a               
          bank statement relating to the Amerifirst account that was in               
          petitioner's name.  Petitioner did not provide to respondent’s              
          revenue agent bank statements relating to the other two bank                
          accounts.                                                                   
               In the summer of 1988, after petitioner rejected the above             
          proposed audit adjustments for 1986, respondent’s revenue agent             
          mailed to petitioner a second letter in which the revenue agent             
          reasserted the initial adjustments and addition to tax and                  
          proposed to disallow an additional $846 in claimed business                 
          expenses.  Again, petitioner refused to agree to respondent's               
          proposed adjustments.                                                       
               On November 10, 1988, in response to a summons from                    
          respondent’s revenue agent, petitioner and petitioner's attorney            
          met with respondent’s revenue agent.  During this meeting,                  
          petitioner provided respondent’s revenue agent with a schedule on           
          which petitioner indicated that he received $26,806 in total                
          commissions and fees in 1986.  At this meeting, petitioner                  
          acknowledged the second bank account at Amerifirst in his son's             
          name, but petitioner did not acknowledge that he also maintained            
          the bank account at Commercial Bank.  The November 10, 1988,                






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