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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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