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to conceal, may justify a strong inference of fraud. Parks v.
Commissioner, 94 T.C. 654, 664 (1990).
Over the years, courts have developed a nonexclusive list of
factors that demonstrate fraudulent intent. These "badges of
fraud" include: (1) Understating income, (2) maintaining
inadequate records, (3) failing to file tax returns, (4)
implausible or inconsistent explanations of behavior, (5)
concealment of income or assets, (6) failing to cooperate with
tax authorities, (7) attempting to conceal illegal activities,
(8) failing to make estimated tax payments, and (9) filing false
documents. See Douge v. Commissioner, 899 F.2d 164, 168 (2d Cir.
1990); Bradford v. Commissioner, 796 F.2d 303, 307-308 (9th Cir.
1986), affg. T.C. Memo. 1984-601. Several of these indicia of
fraud are present herein.
1. Petitioner's Sophistication and Experience
The sophistication and experience of a taxpayer are relevant
in determining whether fraud exists. Stephenson v. Commissioner,
supra at 1006. Petitioner was a highly intelligent, astute, and
successful businessman. He was a consummate salesman. He dealt
frequently with executives of major corporations and prominent
Iranian officials. He was a strong negotiator. He was
thoroughly familiar with his vast business operations, and he
controlled them. Consequently, it is unlikely that he would not
have realized that his Federal income tax liabilities were
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