- 6 - Funds Transferred Taxable Year to Rubbik 1988 $1,135,745 1989 1,061,050 1990 763,790 1991 87,050 Total $3,047,635 Petitioner transferred the above funds to Rubbik pursuant to five written “consulting” agreements between petitioner and Rubbik under which Rubbik agreed to provide consulting services to petitioner relating to the modifications to be made to Gamesa's products to make them suitable for sale in the United States. These agreements were signed by officers of petitioner at the direction of de la Garza, and the agreements were not negotiated at arm’s length. The services mentioned in the above consulting agreements were to be performed primarily by Gamesa employees in Mexico, not by employees of Rubbik. The funds transferred by petitioner to Rubbik were deposited by de la Garza into Rubbik’s bank account with Citibank in Houston, Texas. For the years in issue, de la Garza was Rubbik’s only employee, and he held sole signature authority over Rubbik’s bank account. Most funds withdrawn from Rubbik’s bank account during the years in issue were transferred to Koala Corp., Ltd. (Koala Corp), a trust that was indirectly wholly owned by Santos dePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 Next
Last modified: May 25, 2011