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that in one case he was hired by a major food service company to
learn whether a senior financial officer was defrauding the
company. It was Gollin's job to determine the nature and amount
of the fraud and to help in the potential recovery, including
recovery negotiations. Gollin describes himself as "very into
investigation and potential scams and the like."
Gollin acquired a 2.25-percent interest in SAB Reclamation
for a gross investment of $12,500 in 1982, without taking into
consideration any sales commission rebate or advance royalty
distribution. As a result of his investment in SAB Reclamation,
on their 1982 Federal income tax return Gollin and his wife
Harriet claimed an operating loss in the amount of $10,025. Of a
total of $20,928 in investment tax and business energy credits
flowing from SAB Reclamation, the Gollins claimed $6,391 of the
regular investment credit on their 1982 return and carried back
the remainder, $4,073, to 1979,3 and they carried back $6,919 of
the business energy credit to 1979 and $3,545 to 1980.
Respondent disallowed the Gollins' claimed operating loss and
credits related to Gollin's investment in SAB Reclamation.
Gollin learned of the Plastics Recycling transactions and
SAB Reclamation in 1981 or 1982 from Becker. The two had known
3 On their 1979 Form 1040X, Amended U.S. Individual Income Tax
Return, the Gollins carried back and claimed a total of $4,969 in
regular investment credits. The source of the additional $896 of
regular investment credits is unclear from the record in docket
No. 16922-90.
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