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In July 1982, Murray told petitioner that the Garrahan
Agency would receive commissions because FUH approved the
program. Petitioner was not surprised that the Garrahan Agency
was to receive the commissions.
4. Investment in the Program by the FUH Plan
On July 21, 1982, Walckner sent a memorandum to the FUH
finance committee, of which petitioner was a member, endorsing
the program.
FUH bought whole life insurance from Travelers for about 147
participants in the FUH plan. FUH was named as the beneficiary.
On September 15, 1982, FUH assigned the insurance policies to the
FUH plan.
The Garrahan Agency signed the applications and underwrote
(i.e., assumed the risk of) and issued the policies for the
Travelers whole life insurance contracts purchased for the FUH
plan participants. Petitioner signed the FUH plan's insurance
policies; i.e., he accepted the policies for FUH.
In 1984, the FUH plan converted its insurance policies from
whole life to universal life insurance. The Garrahan Agency
serviced and processed the universal life insurance contracts
with the FUH plan participants and received additional
commissions after the FUH plan converted its insurance policies.
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