Robert A. Stanford and Susan Stanford - Page 17

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               Section 1.864-4(c)(5)(i), Income Tax Regs., dealing with               
          foreign sources of income, describes those activities that are              
          indicative of banking, financing, and similar businesses, as                

               (i) Definition of banking, financing, or similar business.--           
                                    * * * * * * *                                     
                    (a)  Receiving deposits of funds from the public,                 
                    (b)  Making personal, mortgage, industrial, or other              
          loans to the public,                                                        
                    (c)  Purchasing, selling, discounting, or negotiating             
          for the public on a regular basis, notes, drafts, checks,                   
          bills of exchange, acceptances, or other evidences of                       
                    (d) Issuing letters of credit to the public and                   
          negotiating drafts drawn thereunder,                                        
                    (e) Providing trust services for the public, or                   
                    (f) Financing foreign exchange transactions for the               
          The above description of the business of banking and finance --             
          originally contained in the foreign tax credit regulations of               
          section 904 (sec. 1.904-4(c)(1), Income Tax Regs.) -- applies               
          generally to CFC’s for purposes of the “same or similar activity”           
          requirement of the TAMRA section 952 chain deficit rule.  See S.            
          Rept. 100-445, at 275-276 (1988).                                           
               Petitioners argue, among other things, that employees of               
          Stanford Financial were involved on behalf of Guardian Bank, in             
          bank management, the filing of bank regulatory compliance                   
          reports, and other duties incidental, necessary, and similar to             

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