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in consideration of his cooperation with the Government
in connection with its investigations of other savings and
loan associations.
In December 1990, Mr. Dixon was convicted on 23 counts
of bank fraud and was sentenced to serve a term of 5 years
in prison. In July of 1992, Mr. Dixon entered into a plea
bargain with respect to eight other counts of bank fraud
for which he had been indicted. He was sentenced to serve
another term of 5 years in prison, with the second term to
run consecutively with the first. Mr. Dixon ultimately
served 44 months in prison. As part of his 1992 plea
bargain, Mr. Dixon cooperated with the Government in its
investigations of other savings and loan associations.
Mr. Dixon testified in two trials about criminal activities
at Vernon.
The separate 1986 income tax returns filed by
petitioners include identical Schedules C, Profit or (Loss)
From Business or Profession, for a business described as
"Time-Share Unit Sales". Each petitioner reported one-half
of the amount realized from the sale of a club membership
to Mr. Anderson, $77,500, as "Gross receipts or sales" from
that business. Each petitioner also reported the same
amount, $77,500, as "Cost of goods sold" and accordingly,
reported no gross profit from that business.
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