- 7 -
during 1988 and 1989, respectively. Mr. Wang, Sr., used savings,
borrowed money, employer savings plan withdrawals, and vacation
time converted to cash in order to pay his son’s legal expenses.
Before petitioner’s incarceration, Mr. Wang, Sr., made out the
checks for the legal fees jointly to petitioner and the law firm
and gave the checks to petitioner. After petitioner’s
incarceration, Mr. Wang, Sr., issued his checks directly to the
law firm and did not obtain petitioner’s endorsement. Although
Mr. Wang, Sr., liquidated assets and incurred debt to pay about
$110,000 of his son’s legal expenses, in 1993 he sold stock in a
Taiwanese company for over $2 million.
In 1988, petitioner, in connection with the legal expenses,
executed three promissory notes to his father totaling $115,000
(1988 notes). The first note was drafted by an attorney for Mr.
Wang, Sr., and was used as a model for the two subsequent notes.
The notes were unsecured, did not require monthly payments, and
did not begin to accrue interest until 1993. In January 1993,
petitioner executed a note to replace the 1988 notes and extended
the maturity date for 5 years, providing for accrual of interest
during the extended period. As of the time of trial, petitioner
had not made any payments of interest or principal on the
replacement note or the 1988 notes.
On his 1987 tax return, petitioner reported gross income of
$39,521.55, consisting of wages from Morgan Stanley and $67 of
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011