Kim Beauchamp - Page 22

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               5.  Implausible or Inconsistent Explanations of Behavior               
               Petitioner made implausible and inconsistent statements.               
          Examples of such implausible or inconsistent testimony and                  
          behavior are:                                                               
               (a) Petitioner testified that he did not prepare his own               
          returns; however, in his amended petition and his reply to answer           
          to amended petition he repeatedly claimed that he prepared his              
          own returns, and at audit he told Mr. Jung that he prepared his             
          own returns;                                                                
               (b) petitioner told Mr. Jung at audit that none of Ms.                 
          Choe's properties were sold during 1988, 1989, and 1990, but he             
          testified at trial that some of Ms. Choe's properties had indeed            
          been sold;                                                                  
               (c) petitioner testified that the reason he did not give               
          some of his records to Mr. Jung was because they were lost in               
          1994 during the Northridge earthquake, yet the earthquake which             
          petitioner claimed destroyed the records occurred 3 years after             
          the audit.                                                                  
               The cumulative effect of such testimony is indicative of               
          fraud on the part of petitioner.                                            
               6.  Intent To Mislead                                                  
               Misleading statements to an investigating agent may be                 
          evidence of fraud.  See Gajewski v. Commissioner, 67 T.C. at 200.           
          Petitioner attempted to mislead Mr. Jung when he stated that his            
          patients exclusively paid for his services through insurance                



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