Ted W. Gleave - Page 51

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               An aggregate of more than $4.1 million was deposited into              
          Kenmore’s Account during Kenmore’s fiscal 1981 and its fiscal               
          1982.  Supra table 5.  In addition to the $4.1 million of                   
          deposits into Kenmore’s Account, there was some indeterminate               
          amount of cash that passed through Kenmore’s safe, and did not              
          show up in Kenmore’s Account.  The one-write bookkeeping system             
          focused only on Kenmore’s Account.  Both Gleave and Broskin used            
          Kenmore’s Account; the one-write system did not adequately                  
          distinguish among Kenmore, Gleave, and Broskin transactions.  As            
          Heintz and Bohn carried it out, the one-write system used a                 
          miscellaneous column (Gleave account) for any transactions that             
          (1) they were aware of and (2) did not know how to classify.  We            
          cannot deduce what happened to many of the Gleave account items,            
          except that we know that Heintz and Bohn put all the Broskin                
          items that they recognized into the Gleave account.  Not only was           
          the currency in the safe (generally $2,000-$20,000) not recorded            
          in the one-write system, but also there was not a system to                 
          enable Heintz or Bohn to know how much of the currency belonged             
          to Broskin and how much belonged to Kenmore or Gleave.                      
               Kenmore’s operations were large enough and varied enough,              
          and the comingling of Kenmore’s, Broskin’s, and Gleave’s assets             
          was extensive enough, so that it was obvious that detailed                  
          record-keeping was important.  Failure to keep and supply                   
          adequate records may be an indication of fraud.  Bahoric v.                 
          Commissioner, 363 F.2d 151, 154 (9th Cir. 1966), affg. T.C. Memo.           






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