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services were paid to IRA and Holding Co. or one of their
subsidiaries. The payments were commingled with funds from other
entities in Administration Co.’s accounts and later Principal
Service’s accounts. Large amounts of money were distributed to
various entities and individuals, including Kanter, Ballard, and
Lisle, through IRA, Holding Co., HELO, Int’l Films, and the Bea
Ritch trusts. The distributions were disguised as loans and
recorded as receivables. The receivables were shuffled (through
book entries) between the various entities and eventually written
off. Kanter’s use of the various sham entities made it difficult
and sometimes impossible to trace the flow of the money and is
substantial evidence of his intent to evade tax. See Scallen v.
Commissioner, 877 F.2d 1364, 1370-1271 (8th Cir. 1989).
Fourth, as reflected in our findings of fact, Kanter did not
cooperate with respondent's agents at various stages of their
investigation of his tax returns. He withheld relevant documents
and information involving transactions with the Five and the
movement of moneys through the conduit entities such as
Administration Co., IRA, Holding Co., and others.
Kanter caused some records to be destroyed and attempted to
place other records beyond the reach of the revenue agents
conducting the investigation. We find in particular that
destruction of records that were the subject of the IRS summonses
after the issuance of the summonses to be a strong indication of
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