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Bank 1985 1986 1987 1988
Bay Bank of Commerce
Checking acct $1,525,661 $1,622,475 $1,437,782 $1,711,269
Money market -0- -0- -0- 204,056
Lloyds/Sanwa acct 683,161 764,642 632,943 145,305
Total deposits $2,208,822 $2,387,117 $2,070,725 $2,060,630
Some funds deposited into the Lloyds/Sanwa account were
later transferred to Cal Ben’s accounts at Bay Bank of Commerce
and were used to purchase inventory and other supplies for Cal
Ben. Those purchases were recorded in Cal Ben's books and
records as purchases.
During the years in issue, petitioners used funds deposited
into the Lloyds/Sanwa account to purchase tax-exempt bearer bonds
in their individual names. During the years in issue,
petitioners also used funds deposited into the Lloyds/Sanwa
account to pay expenses relating to a personal yacht, a facelift
for Barbara Schachter, and carpet and utility expenses for
petitioners' residence.
Petitioners knew that funds relating to unreported sales
deposited into the Lloyds/Sanwa account had been used to purchase
the bonds, and Barbara Schachter generally cashed interest
coupons associated with the bearer bonds.
In December of 1987, petitioner purchased a 1988 BMW 750IL
automobile with cash totaling $72,451.
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Last modified: May 25, 2011