Robert D. and Patricia K. Kaliban, et al. - Page 35

                                               - 35 -                                                 
           Feinstein also prepared all of petitioners' tax returns.  Alter                            
           explained his and Feinstein's limited involvement in petitioners'                          
           investment activity as follows:                                                            
                        The clients in almost all cases when they had an                              
                 investment proposal presented to them asked for our                                  
                 opinion as to its validity and merit, and to the extent                              
                 that we were able to give advice, we gave advice.                                    
                              *     *     *     *     *     *     *                                   
                        Of course you should understand that many of these                            
                 clients were high income performers.  They had                                       
                 presented to them very frequently from other performers                              
                 proposals that involved * * * tax shelters, and they                                 
                 brought them into our office for review.                                             
                        Under my review or at my direction, Mr. Feinstein                             
                 reviewed these proposals and they involved all sorts of                              
                 * * * tax shelters and invariably these proposals were                               
                 rejected as being without merit.  [Emphasis added.]                                  
           Feinstein explained that petitioners "would come in and say, I                             
           spoke with so-and-so, he's got a terrific thing that was going to                          
           make a lot of money or something and why don't you find out                                
           something about it and let us know--let me know what you find                              
                 Alter mentioned a few investments to petitioners for their                           
           consideration, such as the Plastics Recycling transactions.  He                            
           did not, however, recommend that petitioners invest in the                                 
           Partnerships.  Asked if, "in connection with the making of this                            
           investment yourself, and in recommending" the investment to his                            
           clients, he earned a commission, Alter replied:  "No, I did not,                           
           and I would like to correct your use of the word 'recommend.'  I                           
           told them I was going into it and it seemed sound, and if they                             

Page:  Previous  25  26  27  28  29  30  31  32  33  34  35  36  37  38  39  40  41  42  43  44  Next

Last modified: May 25, 2011