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to purchase gold Krugerrand coins at a premium, then sold the coins
to a dealer at a discount of 5 to 8 percent.
Petitioner was aware of the requirement that banks report
deposits of $10,000 or more and often made efforts to evade making
deposits in those amounts.
To support his check-kiting scheme and to pay off debts,
petitioner borrowed funds. He borrowed approximately $100,000 from
his father-in-law, of which Mrs. Taylor was unaware, and from
several other individuals. Petitioner was unable to repay all of
his debts and often used funds borrowed from one person to pay what
he owed to others.
In July 1988, after a Commercial & Farmers bank officer
notified petitioner that his account at that bank would be frozen,
and that his checks would no longer be honored, petitioner knew
that his check-kiting scheme was on the verge of collapse.
Petitioner then, for the first time, informed Mrs. Taylor of his
check-kiting activities. The Taylors went to Irvington Federal to
liquidate both the family checking account and Mrs. Taylor's
savings account. Petitioner then went (without Mrs. Taylor) to the
Irvington Federal branch where the president of the bank, William
Ottey, maintained his office. Petitioner informed Mr. Ottey of his
check-kiting activities and the action taken by Commercial &
Farmers with regard to petitioner's account. Petitioner told Mr.
Ottey that as a result of Commercial & Farmers' decision to freeze
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