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preferences, we find the preferences reflected on the
certificates to be ambiguous. Petitioners failed to produce any
corporate resolution. We can only infer that the resolutions
contradict petitioners' assertions. Finally, the record
establishes that Kanter was not restrained by corporate
formalities including preferences, stock ownership, asset
ownership, etc.
Kanter claims that Carlco's preferred stock was issued to
Lisle's family trust to give Lisle more control and discretion
with respect to Carlco's investments. We fail to see how stock
that does not have voting control could provide such control or
discretion with respect to the assets of the corporations.
Lisle, Ballard, and Kanter, respectively, had unrestricted
control of the assets of Carlco, TMT, and BWK, Inc. We think
that fact is a strong indicator of the true owners of the assets.
On the basis of the record before us, we conclude that
Kanter personally diverted payments of compensation, including
those made by the Five for his, Ballard's, and Lisle's services
and influence, through IRA, Holding Co., and their subsidiaries.
Petitioners formed and utilized all the corporations as a way to
conceal their true income for the years at issue. The record is
clear that petitioners used all of these accounts as parts of
incorporated or unincorporated pocketbooks. The corporations
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