Jonathan B. Geftman - Page 7

                                        - 7 -                                         
          5/84           20,538                        $16,086                        
          6/84                21,580                   20,538                         
          7/84           24,560                        21,580                         
          8/84              ---                        24,560                         
          Total               82,764                   82,764                         
          Any payment of interest to the trusts by the estate resulted in a           
          wash transaction, whereby for each dollar that the trusts owed in           
          margin interest to E.F. Hutton they received exactly $1 from the            
          estate.                                                                     
               The estate transferred these funds to corporations                     
          controlled by the estate.  The corporations used the funds                  
          borrowed from the trusts to develop condominiums.  After the                
          corporations developed the condominiums, the corporations sold              
          them and held their first mortgages.  The estate formed Berkley             
          Mortgage Corp. (Berkley) as a nominee corporation to hold title             
          in the mortgages and service the mortgage payments on these                 
          instruments.  At all times, the estate owned all interests in               
          Berkley.  Berkley serviced mortgages, accepted payments for                 
          mortgages, and accounted for the money to the beneficiaries of              
          the trusts.  Berkley segregated mortgages on its books indicating           
          ownership of particular mortgages by the estate or the trusts.              
               The trusts owned mortgages in La Playa and Blue Grass                  
          developments during the trusts' fiscal year ended February 28,              
          1985.  All mortgages on condominiums in the La Playa and Blue               
          Grass developments were taken in the name of Berkley as                     
          mortgagee.  Berkley transferred mortgages on the properties to              
          the trusts.  The trusts' journal entries, for the fiscal year               




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Last modified: May 25, 2011