Charles F. Sutter and Cheryl Sutter - Page 4

                                        - 4 -                                         

          Marvin Schwab "gave" Charles Sutter the premium by arranging what           
          was described as "nonrecourse premium financing" through Stable             
          Reserve, Inc. (Stable), a Utah corporation.  Marvin Schwab,                 
          Daniel Schwab, and Devon Nish owned and controlled Stable.                  
          Charles Sutter received a check from Stable, payable to him in              
          the amount of the first-year premium.  The check was drawn on               
          Stable's account, signed by Marvin Schwab.  In turn, a check in             
          the same amount was drawn on petitioners' personal checking                 
          account, payable to the Royal Maccabees Life Insurance Co.                  
          (Royal).  As part of the transaction, Charles Sutter signed a               
          "Promissory Note (Interest)" to Stable in the amount of the                 
          first-year premium, payable with interest, but, at the option of            
          the maker, only from the death benefit proceeds of the Royal                
          policy.  He was not required to, and did not, submit a financial            
          statement to Stable before receiving the funds from Stable.                 
               In addition to the note, Charles Sutter signed an assignment           
          of the Royal policy in favor of Stable, but the assignment                  
          document was never forwarded to Royal.  Royal allowed such life             
          insurance policies to be assigned only with its consent.  Royal             
          was not aware of, and did not consent to, the above-referenced              
          assignment.                                                                 
               Stable offered the type of service provided to Charles                 
          Sutter only to clients or customers of the Daniel Schwab Agency.            







Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  Next

Last modified: May 25, 2011