Robert A. Stanford and Susan Stanford - Page 20

                                       - 20 -                                         
          Bank.  Nowhere in the service agreement is Guardian Services                
          granted the authority to act in the name of or for the account              
          of, or to bind by its actions, Guardian Bank.                               
               Petitioners' 1990 joint Federal income tax return indicates            
          no agency relationship between Guardian Bank and Guardian                   
          Services.                                                                   
               With regard to Stanford Financial, the evidence does not               
          indicate that Stanford Financial ever acted specifically in the             
          name of or for the account of Guardian Bank, nor that it ever               
          bound Guardian Bank by its actions.                                         
               Stanford Financial performed services for Guardian Bank of             
          an administrative and management nature.                                    
               The alleged service agreement between Guardian Bank and                
          Stanford Financial is insufficient to establish the existence of            
          an agency relationship between Guardian Bank and Stanford                   
          Financial.                                                                  
               Based on our analysis of the evidence before us, we conclude           
          that neither Guardian Services nor Stanford Financial is properly           
          to be regarded as an agent of Guardian Bank; rather they are to             
          be regarded as separate entities.  Accordingly, their separate              
          deficits in earnings and profits are not to be treated as                   
          expenses or losses of Guardian Bank.                                        

          Addition to Tax and Accuracy-Related Penalty                                
               Section 6651(a)(1) imposes an addition to tax for taxpayers'           





Page:  Previous  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  Next

Last modified: May 25, 2011