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for a well-educated person like petitioner, who had not been
significantly involved in businesses or investments prior to that
time. A reasonable person in these circumstances would be more
concerned about the bona fides of the transaction. Once
petitioner was at least $3,000 ahead from the refund of his 1980,
1981, and 1982 taxes and reductions in 1983 tax, he lacked
interest in the transaction and its ultimate outcome. This
reflects that petitioner's primary, if not sole, motivation for
involvement in the transaction was the tax benefit received on
the front end, rather than an interest in income or retirement
income sources.
Petitioner contends that he reasonably relied on his friend,
Mr. Chalich (the salesman and coinvestor); his coworker, Mr.
Pecha (the chemistry teacher and coinvestor); and Mr. Shriver
(the accountant connected with the promoter/sales organization).
There is no allegation that Mr. Chalich had any expertise in
energy devices or the economics of the transaction in question.
Other than their long-term friendship, which has no bearing on
this issue, petitioner has not shown that it was reasonable to
rely on Mr. Chalich.
Concerning Mr. Pecha, he was a chemistry teacher and
involved in a wrestling program with petitioner. In addition,
Mr. Pecha also invested in the same Saxon energy-device leasing
transaction as petitioner. Although petitioner relied on Mr.
Pecha's educational and teaching background with respect to the
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