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during the years he prepared petitioners' tax returns at Edward
White & Co. and for all the taxable years at issue.
Petitioner relied on Short to find investments that satis-
fied his investment criteria because petitioner did not have time
to personally investigate all of the potential investments in
which he was interested. As part of Short's investigation of
potential investments for petitioner, Short read books, articles,
and periodicals relating to commodity trading which led Short to
believe that this type of investment met petitioner's investment
requirements.
Since neither Short nor petitioner had prior experience with
commodity investments, Short searched for brokerage firms that
had commodity departments. Short searched for a commodity broker
by contacting brokerage houses and persons he had worked for in
the past, including Edward White & Co. These sources led Short
to Hunter and, in particular, to Russ Klein (Klein), who was
employed by and in charge of Hunter.
Short met with Klein on three occasions before investing
with Hunter. Petitioner only attended the last meeting. The
initial meeting with Klein focused on commodity trading methods
and a projected potential return of 25-47 percent. Short
believed that the Hunter trading methods met all of petitioner's
investment criteria. Additionally, Short believed that Klein
would be able to educate him in commodity trading strategies in
order to enable him to assume increasing degrees of control over
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