Joan Walters, f.k.a. Joan Gherman, and Henry Gherman - Page 29

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          account had been transferred during December 1986 from an account           
          with Prudential-Bache in Ms. Walters' name.  Justice For All Inc.           
          was a Florida corporation formed by Mr. Gherman to hold funds in            
          brokerage accounts and to hold cash in bank accounts.                       
          Tax Returns for the Years in Issue                                          
               Petitioners filed joint Federal income tax returns for tax             
          years ended 1984, 1985, and 1986.  The returns were prepared by             
          or under the supervision of Ronnie Thaw (Mr. Thaw), a certified             
          public accountant (C.P.A.), who had prepared tax returns for                
          petitioners since the 1970's.  The joint return for tax year                
          ended 1984 was filed on August 19, 1985.  The joint return for              
          tax year ended 1985 was filed on August 15, 1986.  The joint                
          return for tax year ended 1986 was filed on September 21, 1987.             
          Mr. Thaw relied on FIP's books and records to prepare                       
          petitioners' joint income tax returns for the years ended 1984              
          through 1986.  Petitioners did not engage Mr. Thaw to verify the            
          books or to perform a certified audit, and he did not perform               
          those services.  When the joint tax returns were prepared for tax           
          years ended 1984 through 1986, Mr. Thaw was not aware of the CD             
          scheme.  Mr. Thaw did not include in income on those joint tax              
          returns any moneys charged on FIP's books and records as loans to           
          either Ms. Walters or Mr. Gherman.  After the returns were                  
          prepared by their accountant, Mr. Gherman had the returns                   
          reviewed by petitioners' tax attorneys before petitioners signed            





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