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they would withdraw cash from their personal savings
account at AmSouth and would use the money at Justins to
cash customers’ payroll checks. Petitioners would deposit
the customers’ paychecks into Crabtree Investments’
business account at First Union, write a check for cash in
that amount, and start the process at Justins over again.
Eventually, they would redeposit the original amount of
money into their personal savings account at AmSouth.
As mentioned above, virtually all of Crabtree
Investments’ original records were destroyed by fire. As
a result, we cannot fully evaluate petitioners’ assertion
that they used cash from their personal accounts in the
bar. Our analysis of the statements from petitioners’
individual checking accounts tends to support petitioners’
explanation. Furthermore, the bank account statements
suggest that the individual petitioners were losing money
during the years in issue. In 1994, they deposited the
“surrender proceeds” from shares in “The Growth Fund” in
the aggregate amount of $41,584.87, and Mr. Eddie Crabtree
deposited a check for $25,790.65, apparently the proceeds
from the sale of real property. Nevertheless, during the
years in issue, the balance in the account went from
$82,284.35 to $9,274.19. Respondent does not assert that
the withdrawals from the joint bank accounts increased the
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