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had been petitioner's accountant for approximately 4 years. Mr.
Coscia was recommended to petitioner by a friend and coworker,
Herb Karlitz, an entertainment lawyer. Petitioner relied heavily
on Mr. Coscia with respect to all financial matters and even
consulted him for help in selecting a health insurance plan.
Prior to 1983, and beginning in or around 1979 or 1980,
petitioner's investments had been exclusively in individual
retirement accounts. However, at some point in 1983, Mr. Coscia
approached petitioner with the idea of investing in a partnership
known as Ridge Energy Systems (Ridge Energy), which was in the
business of leasing energy management equipment from the Saxon
Energy Corporation (Saxon Energy). Mr. Coscia recommended the
investment to petitioner, describing it as a "good idea" that
would be "very beneficial" to petitioner. Petitioner did not
independently investigate Ridge Energy, but instead relied on Mr.
Coscia's advice in making the investment. Mr. Coscia assured him
that "there was a bank involved, a tax consultant involved, tax
specialist that made the whole thing completely kosher." Mr.
Coscia also indicated to petitioner that there was profit
potential in the investment. Mr. Coscia advised him that he had
done "this kind of thing before, they were completely legal, and
there were benefits to be had, especially from a profit point of
view." With respect to the payment schedule, Mr. Coscia
indicated to petitioner that he would most likely receive profits
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