James H. Upchurch - Page 7

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          Petitioner states that the accountant assured petitioner that it              
          was a proper investment.  Mr. Shriver, however, was connected                 
          with Mr. Chalich and was a part of the Professional organization,             
          and he was referred to in Professional's advertising or                       
          promotional brochure.  Professional earned commissions or income              
          on the sale of shelter investments to its clients.  In order to               
          invest, petitioner and Sally Upchurch borrowed $14,000 secured by             
          a second mortgage on their residence.  The loan, however, was at              
          least $3,000 less than the refunds and/or tax reductions                      
          generated by the energy-device transaction.                                   
               Petitioner and Sally Upchurch entered into an agreement with             
          Professional on June 8, 1983.  For a $1,500 fee, Professional was             
          to assist petitioner in developing a financial plan, which                    
          included consultation on ways to increase capital.  In addition,              
          Professional was to provide a 1-hour conference with a lawyer and             
          another with an accountant.  There is no indication whether the               
          fee was paid or the services performed, other than the                        
          consultations with Mr. Shriver, the accountant.                               
               Petitioner and Sally Upchurch acquired a 16.667-percent                  
          interest in Evergreen, which, in turn, was to hold an interest in             
          an energy-saving device.  Petitioner's understanding of the                   
          transaction was that an interest in the energy device would be                
          purchased by the investors, through Evergreen, which would lease              
          the device to a user who would save on energy.  He did not expect             
          a profit in the early years of the energy device's operation                  




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