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receipts (Cattalo--1983, Grove--1982 and 1983, Wilson--1983),
cutting drugs (Grove--1983), not telling supervisors of drug
theft and resale (Cattalo, Grove--1982 and 1983), not revealing
protection arrangements (Grove--1983), and the perjury
previously mentioned (Cattalo, Wilson). Grove, in particular,
made several large cash payments during 1983, for the purchase of
real property and a boat. The cash paid for the real estate was
"under the table".
We hold that respondent has established by clear and
convincing evidence that there is an underpayment of tax due to
fraud for petitioners Wilson, Cattalo, and Grove for the years
1982 and 1983. The entirety of each of their underpayments
arises from their fraudulent schemes. Consequently, for Wilson,
Cattalo, and Grove, the period of limitations does not apply to
1982 or 1983, and we hold that they are liable for the additions
to tax under section 6653(b)(1) and (2) to the full extent of
their underpayments for each year.
The badges of fraud present with respect to Giongo are his
convictions for racketeering and conspiracy and for filing a
false return under section 7206(1). Underlying Giongo's
racketeering conviction were conspiracy, aiding and abetting
bribery, and aiding and abetting robbery. Such crimes, in
contrast to bribery or robbery per se, do not include the element
of obtaining money or property. A conviction under section
7206(1) does not establish fraud but is one factor to be
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