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Priscilla constitutes a constructive dividend to individual
petitioners.
Edward and Stanley also received money from the Coast and
First Pacific accounts. Edward stated that he received the money
because he had a need for U.S. funds, but he could not remember
what he used the money for. Edward also contends that he repaid
the money to Shin within a short period of time. Respondent
suggests that Edward and Stanley may have received these checks
because individual petitioners owed them money or as their take
of a scheme to divert funds from Eastimpex. However, there is no
evidence that the payments to Stanley and Edward provided any
personal economic benefit to individual petitioners or were for a
purpose of individual petitioners. Thus, we find that these
amounts are not constructive dividends to individual petitioners,
regardless of whether Edward and Stanley repaid the amounts to
Shin.
Alternatively, individual petitioners argue that Eastimpex
had a valid business reason for any payments under the 1986
Agreement because the Wan Yang Chen family threatened the
stability of Shin, which was a major supplier of Eastimpex.
There was no evidence that Daniel Chen would obtain control of
Shin. Rather, he threatened to expose the two-tier payment
system to the Taiwanese Government. Individual petitioners
contend that Eastimpex did not receive any benefit from the two-
tier payment system except a delay in having to pay for a small
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