- 34 -- 34 -
1990).
Petitioners' assertion that they reasonably expected an
economic profit from the Partnership transactions is not
credible. Petitioners did not seriously review the offering
memoranda, investigate the Plastics Recycling transactions, or
otherwise educate themselves in plastics recycling. Moreover,
testimony by one of respondent's experts establishes that the oil
pricing changes during the late 1970's and early 1980's did not
justify petitioners' claiming excessive investment credits and
purported losses based on vastly exaggerated valuations of
recycling machinery.
Petitioners' failure seriously to learn about the
Partnership transactions undermines their contention that they
reasonably expected an economic profit from them. Gollin was an
experienced forensic accountant who described himself as "very
into investigation and potential scams and the like," yet he did
not ask to see SAB Reclamation's books and records, nor did he
see a Sentinel EPE recycler prior to investing. Also, Gollin
knew there were no end-users committed to the transaction, and he
stipulated that he does not know whether SAB Reclamation had any
assets. Fishbach was unsure if he had read the offering
memoranda, but speculated that he spent just a short amount of
time perusing them and that he flipped through the risk factors.
Asked if he reviewed the financial projections, Fishbach replied,
"Absolutely not." Fredericks did not understand most of the
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