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reconciling Mr. Thompson's Bauspar account because Earl LeMond,
Mr. Kersting's son-in-law and the manager of the Bauspar program,
did not keep reliable records. Nonetheless, Mr. Kersting
prepared an accounting of Mr. Thompson's Bauspar account
indicating that Mr. Thompson had paid $90,769.72 under the
program and had received nontaxable dividends of $27,000 and
Federal tax and State income tax savings (presumably from
interest deductions) of $36,307.79 and $9,000, respectively.
Mr. Kersting further indicated that, in light of Mr. Thompson's
apparent dissatisfaction, he would waive the normal requirement
that the Bauspar program run for a 10-year period, allow
Mr. Thompson to terminate the program prematurely, and pay
Mr. Thompson $27,000 reflecting 3 years of "equity build-up" in
the program. On the basis of his accounting, Mr. Kersting
concluded that Mr. Thompson would realize a net gain of $8,538.07
from the Bauspar program. Mr. Kersting advised Mr. Thompson to
check his accounting carefully, and that, if necessary, Mr.
Kersting would make adjustments in Mr. Thompson's favor to avoid
a legal dispute.
On March 31, 1986, Mr. Kersting wrote a second letter to
Mr. Thompson stating that the Thompsons owed a total of $11,844
to Avalon Acceptance Corp., Aztec Acceptance Corp., Mahalo
Acceptance Corp., Lombard Acceptance Corp., and Candace, for
interest due on leverage notes during 1983 and 1984.
Mr. Kersting's letter states in pertinent part:
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