Investment Research Associates - Page 202




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         Freeman were subject to his control.  There is no evidence that               
         IRA, Holding Co., or any of the other entities earned these                   
         funds.  Petitioners handled the accounts as if they were their                
         own, moving funds around from location to location and using the              
         funds for their personal benefit.  This is hardly the behavior                
         that petitioners would exhibit if the funds in the accounts were              
         subject to the control of Weisgal or the various entities.                    
              Kanter did virtually all of the planning and implementing of             
         the transactions.  The officers, directors, and trustees signed               
         documents and entered transactions as Kanter directed including               
         issuing and redeeming stock, liquidating corporations, purchasing             
         and selling stock, distributing funds, and executing contracts                
         and agreements.  There is very little evidence that IRA or the                
         other entities had anything to do with these transactions other               
         than to be the named recipients of the checks.                                
              Lastly, we note that payments to IRA were distributed to the             
         accounts of Carlco, TMT, and BWK, Inc. of which petitioners and               
         their family members were authorized signatories.  If, as                     
         petitioners contend, the funds of the corporations did not belong             
         to them, they would have been misappropriating the funds through              
         phony loans. Therefore, we conclude that petitioners were simply              
         using the corporations to receive the funds they had earned.                  
         Regardless of where the funds actually went, they were earned                 








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