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back from his investment even before he paid it in full. Mr.
Coscia also told petitioner that he was an investor in Ridge
Energy as well as members of his own family. Mr. Coscia did not
disclose that he was receiving commissions from Saxon Energy for
bringing in Ridge Energy investors. In late 1983, petitioner
made a capital contribution of $5,391 to Ridge Energy and
received a 5.3-percent interest in the partnership. Petitioner
knew two of the other partners in Ridge Energy, one of whom was
his coworker, Mr. Karlitz. Petitioner did not seek any other
professional advice regarding the investment but did speak with
Mr. Karlitz who reinforced what Mr. Coscia told him.
Petitioner had no prior experience with, or knowledge of,
energy management systems and, with respect Ridge Energy in
particular, he did not know where the equipment was placed, how
it worked, what it looked like, or its function. Also,
petitioner was not aware that the equipment was leased from Saxon
Energy. Petitioner received certain written materials upon his
investment in Ridge Energy that coincided with what he had been
told by Mr. Coscia.1 However, petitioner did not receive
appraisals on the equipment and did not ask to see any appraisals
because he felt "ignorant" about such matters.
1 These written materials are not a part of the record in
this case.
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