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Petitioner and his brother James D. Foust (James) had
engaged in several joint farming and farm-related ventures,3
including the conduct of farming through Foust Bros. Farms, Inc.
(Foust Bros. Farms). Foust Bros. Farms applied for and received
disaster loans from the Small Business Administration (SBA) and
the Farmers Home Administration (FMHA) that were personally
guaranteed by petitioner and James. At the times the FMHA and
the SBA approved the loans to Foust Bros. Farms, petitioner and
James had led the lenders to believe that they were lending to a
separate corporate entity, independently operated and maintained.
However, Petitioner and James did not keep separate books and
records for Foust Bros. Farms. Petitioner and James so
3 The parties have stipulated that, in addition to Foust
Bros. Farms, Teton, Mesa, and Cheyenne River, petitioner filed
articles of incorporation with the Iowa Secretary of State for
the following named corporations, as indicated:
Foust Brothers Leasing Co. 1977
Wind River Corp. 01/04/80
Ag-Land Investments, Ltd. 01/05/83
Southern Cross, Inc. 01/05/83
Blackhorse Corp. 01/05/83
Butte Corp. 11/02/83
Bend Corp. 11/02/83
Williston Corp. 11/02/83
Ranger Corp. of U.S. 11/02/83
Savannah Corp. 11/02/83
Thunderhawk Ltd. 11/02/83
XIT, Inc. 09/18/84
Cathedral Corp. 04/11/86
Agrivest Corp. 01/09/87
Senora Corp. 01/09/87
West Texas Corp. 01/09/87
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