Inverworld, Inc., et al. - Page 120

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            The discretionary authorizations granted LTD the power to                                     
            maintain or to transfer assets in omnibus accounts.  In its early                             
            Discretionary Authorizations, as well as in a brochure for                                    
            "selected investors who are not residents of the U.S.A.", and a                               
            printed newsletter entitled "InverNews", LTD listed the San                                   
            Antonio office as its return address.                                                         
                  Each client also granted a power of attorney to LTD,                                    
            allowing LTD to make investments in the name of the client, to                                
            endorse for deposit and collection instruments payable to the                                 
            client, and to pay bills and fees of third parties on behalf of                               
            the client.  During LTD’s taxable years ended 1984 through 1986,                              
            inclusive, the powers of attorney were notarized in Bexar County,                             
            Texas.                                                                                        
                  In some cases, the promoter assembled the account opening                               
            documents signed by the client and sent them to San Antonio,                                  
            where they were countersigned in the name of LTD.  Mr. Fahey                                  
            executed "some" discretionary authorizations on behalf of LTD in                              
            the United States.                                                                            
                  Once the account was opened, the promoter directed the                                  
            client to wire funds to a bank account opened in Texas in the                                 
            name of LTD.  LTD called this bank account the client clearing                                
            account or clearing account.  Pursuant to its consulting                                      
            agreement with LTD, INC had the authority to invest the "cash,                                
            securities, and other properties comprising the assets" of LTD's                              






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