Investment Research Associates - Page 243




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         3.   Kanter's Fraud                                                           
              Kanter was the architect who planned and executed the                    
         elaborate scheme with respect to the kickback income payments                 
         received from the transactions involving the Five.  Ballard and               
         Lisle participated with him, shared in the payments, and                      
         cooperated in the diversions.  In our view, what we have here,                
         purely and simply, is a concerted effort by an experienced tax                
         lawyer and two corporate executives to defeat and evade the                   
         payment of taxes and to cover up their illegal acts so that the               
         corporations, Prudential and Travelers, and the Federal                       
         Government would be unable to discover them.                                  
              Respondent has proven by clear and convincing evidence that              
         Kanter underpaid his taxes for each of the years at issue                     
         attributable to transactions related to the Five.  Respondent has             
         also proven by clear and convincing evidence that Kanter intended             
         to evade taxes known to be owing on that income by conduct                    
         designed to conceal, mislead, or otherwise prevent the collection             
         of such taxes.                                                                
              The record is replete with several indicia of Kanter's                   
         fraud.  They are:                                                             
              First, Kanter has a legal education.  He has been a                      
         practicing tax attorney since 1956.  He has taught courses in                 
         estate and gift taxation and estate planning at the University of             
         Chicago Law School.  He has lectured and written extensively in               






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